Aave Labs Receives $12M Grant to Build Aave v4

Aave, the prominent decentralized finance (DeFi) lending protocol, is set to receive a significant boost with the approval of a $12 million grant.

The prominent decentralized finance (DeFi) lending protocol Aave is set to receive a $12 million boost with the approval of a grant. The Aave governance has approved a grant of 12 million GHO (Aave’s native stablecoin) to Aave Labs, the development arm behind the protocol, to build out Aave v4 over the next 12 months.

Aave Labs will receive an initial 3 million GHO upfront, with the remaining funds distributed throughout the year. The proposal outlines a one-year technical contributor engagement, where Aave Labs will act as a service provider for Aave v4 development and visual branding enhancements.

The grant will go towards several core components for Aave v4 development, including GHO and soft liquidations. The roadmap will also see enhancements for GHO, and Aave Labs will also create new visual branding elements, such as logos, color schemes, typography, and illustrations.

To ensure transparency, Aave Labs is mandated to submit monthly progress reports to the Aave DAO. As of now, Aave ranks as the third-largest DeFi protocol, boasting a total value locked (TVL) of $12.7 billion, according to DeFi Llama.

AAVE’s price has surged by 4.57% over the past 24 hours, as reported by crypto price feeds. In May, Aave's parent company, Avara, announced plans to build Aave v4.

The rollout of Aave v4 will occur in stages over multiple years, with the revamped codebase expected to deploy around mid-2025. Following the release of v4, Avara plans to unveil Aave Network, a custom Layer 2 solution.

Aave v4 will boast the cross-chain liquidity layer (CCLL) as a key feature, aggregating liquidity from different chains. However, the CCLL is not expected to be operational until 2026 or 2027.

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