A proposal within the Aave DAO is currently assessing the viability of deploying the Aave Protocol on the Monad network, as discussed within the governance proposal, which includes incentives, cooperation, and increasing the scope of decentralized financial services.
The proposal is in the voting stage of a preliminary “temp check” vote to assess the views of the community before moving into other stages of governance.
Proposal Suggests Expansion of Aave to Monad
The proposal for governance suggests that the altcoins lending protocol should be deployed on the Monad blockchain, which is in development as a fast-performing blockchain for decentralized finance applications. If the proposal is accepted, it will be the next move in the altcoins’ multi-chain expansion strategy.
The proposal details suggest that the deployment of the altcoin protocol on the Monad blockchain will come with financial incentives to boost the usage of the Monad ecosystem.
The initiative is currently in the temporary check phase, which is part of the governance process that the altcoin uses to assess the level of support from the community before voting can take place.
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Incentives Proposed by Monad Foundation
As part of the agreement, the Monad Foundation has proposed incentives that will be part of the agreement to encourage the altcoin protocol when it launches on the network.
The incentives proposed by the Monad Foundation include the provision of funds to encourage the liquidity, lending, and development of the altcoin protocol when it launches on the network.
The incentives are designed to cover the initial period after deployment, helping bootstrap activity and integrate the altcoin’s lending infrastructure into Monad’s DeFi stack.
Planned Support for GHO Stablecoin Growth
The proposal also includes incentives related to GHO, a decentralized stablecoin related to the altcoin’s ecosystem. Under the plan, the Monad Foundation would hold 10 million GHO tokens for at least six months.
Aave DAO would distribute 500,000 GHO tokens in incentives to encourage adoption and liquidity on the Monad blockchain. These measures are to facilitate the circulation of GHO in a new blockchain environment.
Potential Future Migration to Aave V4
The proposal indicates that the decision of migrating to a new version of the protocol in the future, for instance, Aave V4, is subject to a decision by the Monad Foundation in the future. The flexibility in the proposal allows for the integration of existing infrastructure in the network.
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