Aave Labs, the developer behind the decentralized cryptocurrency lending platform Aave (AAVE), announced on Monday its intentions to launch a new app on Apple’s App Store.
Aave Labs Introduces Savings-Style App
According to a report from Fortune, this new product is designed to function similarly to a traditional savings account, but with higher yields than those offered by traditional finance banks.
Users can earn a minimum interest rate of 5% on their deposits, which can be funded through bank accounts or debit cards. The app will utilize stablecoins alongside the Aave protocol to offer these financial services.
Aave has established itself as a key player in the decentralized finance (DeFi) and crypto lending sectors, boasting over $3.23 trillion in cumulative deposits, nearly $1 trillion in total originated loan volume and $ billion in total interest paid, according to the platform’s website.
While DeFi protocols often provide users with higher interest rates compared to conventional banking, they also carry heightened risks, such as the potential for hacks and the absence of government backing.
However, Stani Kulechov, the founder and CEO of Aave Labs, assured users of the protocol’s safety. He pointed out that Aave has never encountered an exploit in its five-year history, emphasizing the dual layers of security related to both the market economics and the software code, which has been audited by multiple companies.
Traditional Financial Giants Adopting Crypto
The forthcoming launch of the Aave app arrives at a time when the gap between traditional financial institutions and crypto-native firms is closing. Major players like BlackRock are adopting Bitcoin (BTC) through the exchange-traded fund (ETF) sector.
Stripe has integrated stablecoins into its offerings, and JPMorgan Chase has been actively developing blockchain solutions. In response, crypto firms are increasingly focusing on attracting mainstream customers.
The US crypto exchange Kraken, for example, has newly introduced its own payments app, while various others are working to create bank-like products using stablecoins.
Kulechov remarked, “Typically, DeFi has been accessible to very savvy, professional users. The next step for DeFi is to bring more direct access for consumers.”
Kulechov, a figure in the DeFi movement since launching the protocol in 2020, has expanded the company’s offerings to include a crypto wallet, a decentralized stablecoin, and a protocol for social media.
In October, the firm made headlines by acquiring the stablecoin company Stable Finance for an undisclosed amount. Kulechov noted that the acquisition also enhanced their consumer-focused experience, allowing the team to move more swiftly and improve their product offerings.
While the broader crypto market continues its downtrend, the price of AAVE saw a 2% uptick following the announcement. At the time of writing, it was trading at $171.87 per token.
Featured image from The Seattle Times, chart from TradingView.com