Aave

Aave’s story began in 2019 as a leading DeFi lending protocol that popularised the use of flash loans. It is now one the most widely used protocols that provides lending and borrowing of cryptocurrencies, has the feature of aTokens, possesses liquidity pools, provides flash loan options, isolation mode, etc.

Aave has it’s governance token $AAVE. Holders of this token can vote on proposals and modifications of the protocol, this ensures that the community has an impact on the protocol.These tokens can also be used as collateral and for staking. Staking AAVE tokens gives you the opportunity to earn rewards and participate in the network’s consensus mechanism.

aTokens are a different story and they allow users to Repay in case the underlying borrowed asset is locked in the Aave liquidity pool. If a user has stable DAI debt and also holds aDAI tokens, the person can use the aDAI tokens to repay the debt, in one transaction.

Aave started off with Aave v1, which is now no longer in use. Users can now utilise Aave v2 and v3 options. Some of the differences between these version can be viewed in the "Aave versions comparison" article.

Aave also offers High Efficiency Mode - eMode in Aave v3, which is designed to maximize capital efficiency when collateral and borrowed assets are correlated in price. The max amount of eMode categories is 255, with each category having it’s own risk parameters.

In Defi Saver, Aave is available on mainnet (Aave v2, Aave v3), while Aave v3 is also available for use on Optimism, Arbitrum, and on Base.