Aave has been making serious headlines over the past couple of years. To say that it took the DeFi sector to a new level is a serious understatement.
Its next-gen protocol allows users to lend, borrow and earn interest with their assets.
And since it runs on smart contacts powered by the Ethereum blockchains, you can expect lightning-fast transactions without the middlemen.
And, if you are planning your next crypto asset investment and Aave is not on your list, you are seriously playing your cards wrong.
To further prove why Aave is worth investing in, take a look below.
What Exactly Is Aave?
With Aave, investors can easily borrow, lend and earn interest on their crypto assets.
Its decentralized nature is extremely attractive to investors that want to cut out the middlemen and enjoy a world without barriers.
Since it runs on the Ethereum blockchain, it’s considered to be a smart contract system that is run by a distributed network of computers.
In the crypto world, Aave is notorious for its super-fast loan issue speeds. Its native token, the AAVE token is currently hovering at $58, and if you are interested in investing, it might be the right time for you to get in the game.
How Does Aave Work?
Aave can be viewed as a lending pool by traders. As soon as you deposit your funds, the system allocates them to the liquidity pool.
And if you wish to take out a loan, you will withdraw from this pool of funds.
This entire process is performed with the help of the AAVE token and its users can enjoy various benefits.
For instance, if you borrow Aave, you won’t have to pay any interest if you deposit collateral.
Compare that to taking out a loan from a bank. You will have to pay serious fees in interest and it might not pay off at all.
However, that’s not all, Aave offers a lot more benefits and they should be known.
Its Code Is Open Source
Since Aave’s source code is open source, the public is fully aware of how the whole system works.
When an investor is on the lookout for new assets that might make them serious amounts of profit, they will first analyze the code.
This will help them pinpoint any hidden fees or risks that come with that particular crypto asset.
Decentralization And Non-Custodial Nature
For investors who value privacy, decentralized coins are always on their radar.
With decentralization, you can cut off all middlemen and make transactions your own way.
With banks, you will have to go through a lot of phases and stages and a simple overseas transaction can take three to four days to process.
In addition, Aave is set up in a way that it doesn’t actually hold your crypto assets.
This way, you have complete ownership of your assets and if the system is a victim of a cyberattack, you won’t lose any funds.
Different Rate Options
With Aave, you can control the rate of your interest. There are two options, stable and variable.
So, carefully research these two options and pick the right one to meet the investment goals you have laid out.
Where Can You Buy Aave?
Aave can be found on all major crypto exchanges which further solidifies its popularity and potential to become the next big thing.
However, before you purchase AAVE tokens, make sure that you thoroughly do your research and analyze your potential ROI.
A good place to start would be the Aave whitepaper and its official FAQ.
You can also take to social media to see the public opinion regarding this particular asset. You can learn a lot from experience traders and investors.
That being said, do not invest anything more than you can afford to lose. The market is volatile and no one can predict the next crash or the bull run.
Bottom Line
Cryptocurrencies have been the craze for more than a decade now. Its ability to make people rich is unparalleled.
In addition to that, this type of DeFi coins can serve to set up individuals for nice passive income via interest rates.
Aave is one of the most famous systems that allow users to lend and borrow with little to no fees.
If you think that it’s the right asset with the right features for you, don’t hesitate to visit reputable exchange sites to get your hands on it.
