Aave Considers Proposal to Deploy V3 MVP on Neon EVM
A new proposal could provide an opportunity to capture a share of the Solana DeFi market, grow the user community, and increase TVL and protocol revenue for Aave if approved.
The Neon Foundation and the Aave-Chan Initiative are considering a proposal to deploy a Minimum Viable Product (MVP) version of the decentralized lending protocol Aave V3 on the Neon EVM mainnet, the first Ethereum Virtual Machine (EVM) infrastructure designed for Solana.
Deploying Aave V3 on Neon EVM will allow Aave to tap into the deep liquidity on Solana, enabling Solana ecosystem users to access Aave's leading lending protocol through Neon EVM.
Go check out our proposal in the @aave governance forum!
— Neon (@Neon_EVM) January 15, 2024
This is our first step in bringing Aave V3 MVP to Neon mainnet, expanding Aave’s presence and enabling access to the Solana ecosytem.https://t.co/P68kusOggV
The proposal recommends a cautious approach by limiting the deployment to specific assets and setting prudent risk parameters. Specifically, it mentions three collateral types: SOL, mSOL, and jitoSOL, with the only borrowable asset being Circle's stablecoin USDC.
Currently, the proposal is in the "Temp Check" phase, where Aave community members can share their views and feedback on the integration. If the proposal gains sufficient preliminary support, it will move to the on-chain voting phase for a final decision.
The community expects the proposal to pass because a fork of Aave V3 has already been deployed on the Neon EVM Devnet, demonstrating full compatibility. This deployment will allow Aave to leverage Solana's liquidity for its lending services without rebuilding the Aave V3 codebase, reducing development burdens and costs for the Aave DAO.
Additionally, this aligns with the concept that was unsuccessfully attempted by Aave's lead developer Marc Zeller in December 2023.
I have been asked recently about Aave x solana.
— Marc “Billy” Zeller 👻 🦇🔊 (@lemiscate) December 27, 2023
A year ago not long after FTX collapse my opinion on it was very sharp.
Today my opinion hasn’t changed on deploying on L1 the potential ROI is simply not good enough to consider.
What has changed is my opinion to consider neon. pic.twitter.com/Op1CrxY7mu
Neon EVM is an innovative technology being developed on the Solana platform, aiming to combine the strengths of Ethereum Virtual Machine (EVM) and Solana. It promises to deliver the high performance of Solana with the popular Dapp development capabilities of Ethereum.
Aave is a leading decentralized lending protocol with over $5 billion in total value locked (TVL), integrating 10 blockchain networks, with its lending pool on Ethereum accounting for more than $2.2 billion.
The integration of Neon EVM and Aave has the potential to create a cross-chain future, presenting an exciting opportunity to capture a share of the Solana DeFi market, grow the user community, and increase TVL and protocol revenue. Furthermore, Neon EVM will benefit from having a top DeFi project like Aave on its platform, diversifying and expanding the available DeFi options for users within the broader Solana ecosystem.
