Lending and borrowing platform Aave (AAVE) has launched a new decentralized stablecoin on the Ethereum (ETH) mainnet.
The dollar-pegged stablecoin, called GHO (GHO), is governed by the Aave decentralized autonomous organization (DAO).
Nader Dabit, the director of developer relations at Aave, says that GHO is an “overcollateralized” stablecoin.
“Anyone can mint GHO using the assets they supply into the Aave Protocol V3 Ethereum market as collateral, ensuring that GHO is overcollateralized by a multitude of assets.
With GHO, the underlying mechanics and policies are fixed and cannot be changed arbitrarily by a centralized entity or an individual. All transactions are conducted via self-executing smart contracts, and all information regarding GHO transactions is published and auditable directly from blockchain or from many user interfaces.”
Aave says in GHO’s launch announcement that the stablecoin is transparent and committed to the protocol’s community.
“The repaid interest on GHO is redirected to the Aave DAO treasury. This supports the sustainability of the protocol and the ongoing development of new features”.
More than 2.7 million GHO tokens have already been minted on Ethereum since the stablecoin officially launched on Saturday, according to the project’s website.
GHO fell from its dollar peg to a low of around $0.978 at one point on Sunday. It is trading at $0.982 at time of writing.
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