ACI Shares Proposal for Incorporating USDtb into Aave V3 Core System
In Brief
The Aave Chan Initiative has put forth a proposal for a temperature check to add USDtb to the v3 Core System, allowing borrowing while disabling collateral usage.
Provider of growth and business development services focused on the decentralized finance (DeFi) lending protocols. Aave The Aave Chain Initiative (ACI) has issued a temperature check proposal for the inclusion of USDtb into the v3 Core System, where borrowing can occur but collateral will be disabled.
USDtb is a stablecoin built on blockchain technology, pegged to the value of the US dollar, and serves the same functions as traditional dollars for transactions, asset trading, and value retention. Unlike physical dollars, USDtb benefits from blockchain capabilities, offering quicker and more cost-effective transactions compared to conventional banking systems. What distinguishes USDtb is its comprehensive backing by institutional-quality tokenized US Treasury fund products, as well as a stablecoin reserve that allows for rapid redemptions, ensuring consistency in value. Initially, the backing for USDtb will come from BlackRock’s USD Institutional Digital Liquidity Fund Token, known as BUIDL.
By introducing USDtb, Aave intends to unlock greater borrowing liquidity, specifically enhancing sUSDe leverage with competitive borrowing rates. This development is anticipated to drive increased growth and activity within sUSDe on the Core System. Considering that USDtb is backed by BUIDL, a product from BlackRock—one of the significant players in asset management—this asset aligns well with Aave’s objective to deliver liquidity for top-tier assets within DeFi, and is expected to draw in substantial deposits.
The proposal suggests that the decentralized protocol Ethena plans to invest a considerable sum into USDtb.
Proposal Process: Transitioning from Snapshot to ARFC and On-Chain AIP Vote for Final Authorization
If this proposal garners consensus, it will advance to the Snapshot phase. Upon receiving a positive outcome in the Snapshot, it will carry over to the Aave Request for Comment (ARFC) stage. After a standard ARFC is published, the community and service providers will provide feedback before moving to the ARFC snapshot phase. If the results of that snapshot return a 'YAE,' a formal proposal payload will be forwarded for an on-chain AIP vote to secure final approval and implementation.
Through Aave, users can both lend and borrow various cryptocurrencies. The V3 Core Instance serves as the primary contract that regulates the protocol's activities, including asset management and transaction workflows. This fundamental contract is crucial to Aave’s operations, enabling significant features such as cross-chain interaction and improved capital efficiency.
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