Leading decentralized lending protocol Aave AAVE +9.77% deployed Aave V3 on the Era mainnet, powered by ZKsync ZK +4.24% , as part of a wider embrace of its ecosystem.
The launch aims to bring liquidity and more ways to generate yield on tokens to the Elastic Chain ecosystem — a network of chains powered by ZKsync technology. At the same time, Aave users may benefit from zero-knowledge proof technology, which provides cheap but secure transactions.
“By combining ZK-proofs and the unified Elastic Chain ecosystem, Aave can unlock unprecedented scalability, privacy, and security, expanding the DeFi user base and new institutional use cases,” said Stani Kulechov, Founder and CEO of Aave Labs, in a press release.
“With the deployment of Aave on Era, a greater audience will be able to leverage ZKsync to its fullest potential,” added ZKsync co-inventor Alex Gluchowski.
Opening the door to privacy applications
The launch of Aave on Era could open new opportunities for privacy-centric DeFi applications. The teams involved view the deployment as having the potential to enable new institutional use cases, such as private networks and networks customized for specific asset classes, risk profiles and user segments.
“This launch is an important milestone in terms of DeFi scalability, and its potential to increase institutional usage is an exciting development for onchain finance at large,” said Johann Eid, Chief Business Officer at Chainlink Labs. Chainlink will provide price feeds as part of the integration.
BGD Labs reported a positive technical review of the deployment, and the Aave DAO has approved USDC, USDT, WETH and wstETH as the first assets to be available on Era.
Furthermore, the Aave DAO committed to redistributing airdrops received from the ZKsync ecosystem via liquidity mining for its users. The distribution will include GHO — Aave’s overcollateralized native stablecoin secondary — liquidity incentives, safety module deployments and merit programs.
ZKsync is a Layer 2 scaling solution for Ethereum designed to enhance the network’s transaction capacity while lowering costs. It utilizes ZK-rollup technology that enables the bundling of multiple transactions into a single proof that is then verified on the Ethereum blockchain. ZKsync enables developers, enterprises, and financial institutions to deploy customizable ZK Chains, forming the Elastic Chain ecosystem.
This is not the only product under the Avara umbrella that’s expanding to ZKsync. Social media protocol Lens is in the process of migrating from Polygon to ZKsync. The migration is currently slated to take place in Q4.
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