By
Mayowa Adebajo
February 14th, 2024
It was also revealed that Aave plans to decentralize governance for Aave Pro in the future.
Aave, a leading DeFi platform has announced that it will launch the permissioned DeFi, or a permissioned version of its platform for traditional financial institutional this month. Crypto researcher and Twitter user “TraderNoah” on June 4, posted a screenshot of an email sent by the organizers of Blockworks’ “Next Steps in Institutional DeFi” webinar that included Stani Kulechov, founder and CEO of Aave, Co-founder and CEO of Fireblocks, Michael Shaulov, and Galaxy Digital CEO Mike Novogratz.
The mail stated that Aave is on the brink of launching its institutional product, called “Aave Pro,” this month in response to “extensive demand from various institutions.” The statement in the email was later confirmed by attendees of the Next Steps in Institutional DeFi webinar with additional report revealing that, the platform will be launched in partnership with crypto custodian and service provider Fireblocks. Fireblocks will be tasked with implementing anti-money laundering and anti-fraud controls for Aave Pro and is assisting Aave to explore how such markets can be deployed. The email also revealed that Aave plans to decentralize governance for Aave Pro in the future.
Aave Pro will only support four assets at launch, including BTC, ETH, AAVE, and USDC, all with its pools separated from Aave’s other deployments. The imminent permissioned platform will be equipped with a “whitelisting layer onto its V2 smart contracts to ensure that only financial institutions that have passed Fireblocks’ ‘Know-Your-Customer verification’ can access Aave Pro.
Stani Kulechov first revealed in May that the decentralized DeFi lender’s plans for a permissioned pool for institutions were underway. Kulechov speaking in the webinar stated that permissioned versions of decentralized finance (DeFi) will have to emerge before banks and other traditional institutions can get involved in automatic anonymous lending.
Kulechov added that, traditional financial institutions including banking majors are looking to get involved in the automatic anonymous lending because they see the power of DeFi and its potential to be a great threat to existing business models. He however highlighted the “carry out know-your-customer (KYC) checks” in the of autonomous lending pools and automated market making as a very vital tool which banks and financial institutions have failed to see.
“We believe that creating this kind of ability of whitelisting and blacklisting addresses regarding this institutional market makes it easier to scale in institutions, because it lowers the risk in general,” he stated. Fireblocks CEO and co-founder Michael Shaulov, speaking at the seminar also stated that his firm is able to basically operate within a network where they already know the participants. “We are able to basically validate and vet them into the network and essentially create this sort of gated community,” he added.
Aave’s three deployments currently represent a total value locked of almost $17 billion combined.