GM, Aave community!
Aave Labs has continued to make steady progress on multiple protocol endeavors in line with its service provider scope, with Aave V4 development as the primary focus.
The below summary highlights developments in the Aave Protocol and reflects Aave Labs’ transparent and collaborative approach of building in public, welcoming community feedback, and fostering auditability through open-source principles.
March update:
- Continued Aave V4 development.
- Finalized GHO Expansion to Base.
- Continued hardening of Aave V3 on Aptos.
- Progressed the implementation of the GHO CCIP Bridge and the GSM L2.
- Continued Aave Interface V4 development.
- Advanced preparations for Umbrella activation.
- Integrated Linea market into the Aave Interface.
- Supported ongoing integrations.
Aave V4 Updates
Aave Labs continues to advance V4 development at a fast pace, focusing on further refinements to the Liquidity Premium algorithm and structural improvements to the Spokes and Liquidity Hub.
Earlier this month, Aave Labs gathered the team in an onsite session to intensify progress on Aave V4. The @Certora team participated in-person, strengthening collaboration on reviewing core features and contributing to the protocol’s security. Collaboration with Certora continues on a weekly basis, and Aave Labs is looking forward to engaging with additional service providers in the coming weeks.
The team executed a comprehensive set of tests on the Liquidity Premium model to address inefficiencies identified during prior development. These efforts resulted in a redesigned algorithm featuring simpler logic and enhanced gas efficiency. This approach encourages increased borrow activity while simplifying supply and the overall system. Subsequent testing validated these improvements, demonstrating that the revised Liquidity Premium algorithm captures market dynamics with a greater level of precision.
In parallel, the Spokes architecture and the Liquidity Hub codebase were aligned with the redesigned Risk Premium model to better capture varying risk profiles. This refactor not only improved the code structure and eliminated unnecessary complexity, but also progressed the overall modular design—enabling a more direct and efficient interaction flow among all key components. Additionally, Aave Labs has explored different use cases that will have a simpler implementation by leveraging the protocol’s modular V4 design, including eMode and isolation mode.
What else are we working on?
GHO Expansion to Base
Building on last month’s completion of the GHO expansion to the Base network, GHO was subsequently enabled as a fee token within Base’s CCIP implementation, allowing users to pay cross-chain transaction fees directly with GHO for a seamless payment experience.
Aave V3 on Aptos
Aave Labs has continued enhancing the codebase starting from the Aave V3.0.2 implementation, making improvements to align it with V3.3 (excluding Liquid E-modes and Umbrella). In parallel, the team remains in close contact with the SpearBit and Cantina teams as they progress through ongoing security audits. Additional measures have been prepared, including a dedicated security contest and a bug bounty program.
GHO CCIP Bridge and GSM L2
Aave Labs has continued providing technical support for the GHO CCIP Bridge implementation by @TokenLogic. The AaveCcipGhoBridge.sol smart contract manages bridging of GHO tokens across multiple blockchains by leveraging Chainlink’s Cross-Chain Interoperability Protocol (CCIP). In parallel, Aave Labs is actively collaborating with @TokenLogic on the GSM L2 implementation, where GHO is minted on Ethereum and bridged over the destination network where liquidity is used based on demand. Both efforts remain in active development, highlighting an open, collaborative approach among Aave service providers.
Interface
Aave Interface V4
Development of the new Aave Interface V4 is advancing steadily, featuring notable progress in user-driven design controls and interface flows. While maintaining alignment with the forthcoming Aave V4 requirements. This month, the team has concentrated on refining supply flows, optimizing state management, and developing the core components of the new application, prioritizing an enhanced user experience for the next iteration of the protocol.
Aave Umbrella Activation
The integration of the Umbrella module into the Aave Interface is proceeding in alignment with its upcoming activation. This integration marks the final step of several weeks of diligent effort and robust testing to facilitate seamless integration. Throughout this period, Aave Labs has engaged closely with @bgdlabs to maintain alignment and facilitate consistency across implementations.
Aave V3 on Sonic
Aave Labs has completed the integration of Sonic with the Aave Interface. This integration includes all essential components and utilities, providing a streamlined experience for users to manage positions on the Sonic network.
Ongoing Integrations
Updates on the Aave Interface related to tokens and community incentive programs, such as the integration of the weETH Merit Campaign, resolution of general bug fixes, and implementation of minor feature enhancements.
What’s coming next?
Our main focus for the coming month will be
- Progressing the development of Aave V4.
- Continuing the security effort associated with Aave V3 on Aptos.
- Continuing GHO expansion to more networks.
- Advancing GHO CCIP Bridge and GSM L2 implementations.
- Integrating Aave Umbrella into the Aave Interface.
Stay tuned for next month’s update.
Aave Labs