AAve Enabled Balancer LP And Uniswap Tokens For Collateral Use

Aave enabled Balancer LP and uniswap tokens to be used as collateral as one of the main and leading Defi lending protocols on the market so let’s read more in our latest cryptocurrency news.

AAve is one of the market’s leading lending protocols which brings further offerings to the value proposition and released an announcement that Aave enabled Balancer LP and Uniswap tokens to be collateralized on the platform.  Aave now has over $5 billion in total value locked as per the data from Defi Pulse and ranks third in terms of this metric, right behind Compound and Maker.

In a recent announcement, the protocol took some steps to expand this and targeted one of the hottest segments of the DeFi markets especially Balancer and Uniswap. According to the release, the “new AMM Liquidity Pool enables liquidity providers of Uniswap and Balancer to use their LP tokens as collateral in the Aave protocol.” LPs no longer have their tokens asleep as they can borrow against them and use the capital. The platform will support 14 Uniswap V2 LP tokens and 2 Balancer LP Tokens.

Those who deposit LP tokens are able to borrow DAI, ETH, USDC, USDT, and wBTC. Also, users that deposit DAI, ETH, wBTC, USDC will also be able to borrow AMM LP tokens. To estimate the value of these tokens from Uniswap and Balancer accurately, Aave will leverage Chainlink’s oracles. CEO and founder of AAVE Stani Kulechov noted:

“Aave is on a multi-market journey. Now you can use your Uniswap and Balancer LPs as collateral, soon to be followed by Sushiswap and Curve LPs. Over 16 LPs available from today.”

As recently reported, The Defi market saw more traction from retail and institutional investors as they are getting more interested in Defi because of their actual cash flow. This makes DeFi protocols comparable to conventional companies that use traditional valuation models and the overall demand for DeFi increasing naturally. Parts of the reasons for the increase are oracles and lending. Lending platforms like Aave and Compound saw large increases in user activity and lending volume which caused the valuations of the coin to soar. Analysts from Santiment noted that the number of Aave whales increased dramatically in the past month which is only an indication of high-net-worth investors that are accumulating the coin.