Iteration or optimization? Details of the upcoming AAVE V3 new features

Yesterday, the proposal to deploy Arbitrum to Aave V3 was officially approved. The voting lasted for a week, and it received an all-time high of 580,000 votes (AAVE) and a 99.99% pass rate.

Recently, Aave V3 has been discussed a lot on Twitter, and it is even considered to be a game changer for DeFi.

But these are just fragmented cheers for the official documents of Aave V3 (only more than 3500 words), but I don't know what is good, or what changes have been made?

This article systematically sorts out the new features of Aave V3 and the possible changes.



Iteration: Portal for Cross-chain Lending

DeFi users are split between different public chains and the liquidity of Layer 2. Cross-chain bridges are generally used when cross-chain interaction is required. The steps are cumbersome, and each step has additional gas fees or handling fees, which inhibits cross-chain interaction. chain behavior.

Aave V3, on the other hand, launched a Portal, which allows users to seamlessly transfer assets from Aave V3 accounts on different chains.

The implementation principle is actually very simple, that is, destroy aToken on the original chain, and at the same time mint the corresponding aToken on the target chain.

This function has been implemented in some small and new DeFi protocols last year, such as the decentralized cross-chain lending protocol Flux V3, which can access and borrow between BSC, OEC and Heco without loss.

As the head lending protocol of DeFi infrastructure, the upgrade iteration is relatively lagging behind, but Aave V3 is keeping up with this technological trend.

We can foresee that when Aave V3 is officially deployed in various public chains and Layer 2, it can bring two intuitive changes:

First, the interest rates of Aave V3 on different chains will be smoothed, because users’ assets (aToken) on Aave V3 can be cross-chain without loss. This change is for Aave users.

Second, Aave V3 may become a DeFi cross-chain transfer station.

user



Although the cross-chain flash swap project can also be implemented, Aave V3 not only does not have so much capital loss, but also provides lending services on the basis of cross-chain flash swap, which is equivalent to users can increase leverage to experience more DeFi products and Capture more profit. This change is for all DeFi users.

In general, the Portal function of Aave V3 can not only effectively solve the problem that the liquidity of the Aave protocol is divided into various blockchains, but also for the entire DeFi field.

Although this function is not a first-mover advantage, Aave has infrastructure-level advantages in terms of user stickiness, capital volume, assets and types of public chains, and can cope with users' daily cross-chain lending.

The launch of Aave V3 is believed to not only retain the product stickiness of existing users, but also guide new users in in a short period of time.

Optimization 1: High-efficiency mode (eMode) for customizing mortgage rate and liquidation rate