The Aave DAO completely voted in support of a proposal to launch the third iteration of its lending service on Metis, an L2 scaling network built atop Ethereum’s blockchain.
Launching on Metis will allow users of the popular DeFi lender to access lower transaction fees and enjoy liquidity incentives offered by Metis.
The move could bootstrap activity on Metis and drive adoption on the L2 amid growing competition in Ethereum’s scaling protocol landscape.
Ethereum L2 scaling network Metis will welcome DeFi lending protocol Aave to its ecosystem after a community voted in support of the move. Indeed, members of the Aave DAO community backed deploying the lenders’ third iteration or version 3 service on Metis.
The proposal opened for voting on May 2 and concluded last Friday. Not a single voter or community member opposed the move, signaling total support for deploying V3 on Metis.
Aave’s launch on the Ethereum L2 network beckons fresh rewards for Metis users who borrow and lend digital assets via the decentralized finance service. The move could also galvanize activity on Metis as the protocol competes with other scaling networks like Arbitrum, Optimism, and Polygon.
While the last bull run propelled Metis to the limelight, the network’s adoption has suffered blows amid market downturns and increased market competition. Metis boasts cheaper gas fees compared to Ethereum, giving users a more cost-effective alternative without giving up transaction security. Providing cheaper transaction costs is usually a common offering from L2 networks.
In a bid to encourage adoption and leverage Aave’s V3 launch, Metis will offer liquidity incentives to users. Liquidity miners will receive 100,000 METIS coins within a 6-month timeline after deployment. Also, 4,000 METIS tokens will be distributed to token miners as part of a reward program.
Aave Fuels Expansion Campaign
The DeFi lender seems on a mission to expand beyond Ethereum’s base layer with a dearth of governance proposals. In April, the governance DAO voted to launch V3 on BNB Chain, a major liquidity hub for decentralized finance users. The move was announced shortly after leading decentralized exchange Uniswap moved to launch on the Binance blockchain.
Aave DAO also voted to remove BUSD from lending markets on Ethereum. The proposal argued that regulatory actions against stablecoin issuer Paxos and the token’s declining supply greatly diminishes BUSD’s utility.