Are we doing everything we can do to grow Horizon and GHO? I’ve been watching loans/borrows and GHO outstanding. They are up over the long term, but I’m wondering if there is anything we can do to grow them further. I see these two growth areas as potential huge new revenue drivers that could completely change how AAVE is valued. I wanted to open up this thread to talk about what we are doing to grow GHO and Horizon and to brainstorm further ideas about how to grow GHO and Horizon. I believe anti-GHO could be a huge driver of $aave token demand, but that coming into play requires that GHO grow a lot more and become profitable from what I understand. Are there ways to spend capital smartly to grow GHO and Horizon further? Is GHO going to be used in Aave App?
From a strategic perspective and as moat I believe a EUR denominated ‘GHO stablecoin’ would make a lot of sense. I know a lot of people trying to get out of USD denominated assets and I would myself hold a EUR stablecoin that offers a decent ‘umbrella return’ (similar to GHO). Best, Samuel
Thank you for opening up this thread axieaur. I share your view on the scale of revenue Horizon and GHO can drive to Aave.
As I think about the next steps to grow Horizon, it’s important to first recognize that, eventually, all traditional assets will be tokenized and onchain. While we are early in that journey, it’s no secret every global bank and asset manager has a tokenization strategy.
Horizon was built through direct feedback by issuers and institutions requiring a friendlier approach to interacting with DeFi to meet their regulatory compliance requirements.
Within the first few months of Horizon’s launch, it became the largest and fastest growing market for tokenized assets. Horizon reached over $600m net deposits and $200m borrowed this month, proving there is demand for permissioned assets to be used within DeFi.
The next growth phase for Horizon will be driven by several factors.
First, we need to continue to expand the collateral asset types institutions can use on Horizon, expanding the asset classes supported is key to reaching a broader set of institutional users. Horizon’s architecture was uniquely designed to meet issuer and user compliance requirements, including enabling users to supply native un-leveraged permissioned tokenized assets directly. As a result, our focus going forward is onboarding assets that will drive the most borrow demand while maintaining the compliance and safety of the protocol.
Today, Horizon on Aave V3 has a carefully curated asset mix across MMFs, CLOs, and institutional carry funds. Launching Horizon on Aave V4 will be an important step toward supporting a broader set of assets, including equities, where segregating risk across different volatility and risk profiles is crucial. Doing this well will also require continued support from the Aave ecosystem, including partners like @LlamaRisk and Chainlink Labs.
Secondly we need to continue to expand Horizon’s distribution by partnering more closely with tokenization platforms and issuers. Our relationship with issuers of RWAs is mutually beneficial, assets onboarded to Horizon instantly become more attractive as they have utility, which increases investor demand for the RWA. In return, those investors drive protocol revenue by borrowing stablecoins. For example, Superstate’s tokenized carry fund doubled its AUM after being onboarded as collateral on Horizon. Today, ~68% of USCC’s Ethereum AUM is supplied on Horizon.
Lastly, builders and onchain asset managers like @TokenLogic, Renzo and Sentora, with more integrations coming, are important in helping drive this next phase of growth, as they expand the reach of institutions Horizon supports through white glove services and vaults.
On GHO, I believe a unique growth vector is integrating GHO as a liquidity component within tokenized assets. Going forward tokenized assets issued onchain won’t necessarily be direct representations of traditional securities, but hybrid products that will be uniquely created for institutional demand onchain. GHO is well placed to be front and center as a liquidity sleeve within newly developed tokenized products.
In 2025 we proved there is institutional demand for tokenized assets within DeFi. In 2026 we’ll scale Horizon and surpass $1B in net deposits. I’m keen to discuss additional ways we can get there and continue to grow Horizon and GHO.
Reality it can be easy for Labs to growth GHO on Horizon.
Yet currently interest rate model is not optimized to have GHO been borrowed.
If Labs want to make GHO competitive the borrow interest curve must be setup just a little bellow USDC borrow rate (including discount)
Also, the fact that RWA doesn’t have their yield displayed makes access to the information difficult to reach.
Currently, Horizon has 217m of RWA and 221m of RLUSD (with only 126m RLUSD borrowed), so currently the instance is half RWA and a quarter just a stacking contract for Ripple RLUSD.
Currently instance do not profit to GHO and so the Aave DAO but to Ripple