I’d also second this notion. Building a reserve in interest-earning stablecoins is beneficial for future incentive programs where stablecoins are beneficial to AAVE rewards, and this program would allow us to do so without having to liquidate AAVE from the reserve or use the core team’s internal balances to grow this stable reserve.
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I will admit, I was initially attracted to $LEND due to the idea that it would be market bought (not from a non-circulating pool) and burned. But I think that idea had more psychological attractiveness than actual numerical impact – looking at the % of $LEND actual burnt, compared to market volume of the token, or overall market cap, I don’t think the burns themselves were large enough to have a notable impact.
Debate about burning aside, I think this proposal is a good one. The issue with LEND liquidity means leaving things as they are will cause the burning to pay a higher and higher premium, effectively wasting a % of the fees to slippage. Collecting the fees in a treasury means that, even if no better opportunities come up, a later proposal can decide to start burning AAVE and get better market rates.
Congratulations everybody - the AAVE governance treasury was successfully bootstrapped at https://etherscan.io/address/0x464c71f6c2f760dda6093dcb91c24c39e5d6e18c. The start of a great journey!
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Awesome news! Happy to see the community come together, as well as some interesting forms of meta-governance taking place.
This is a significant first step towards building Aave as a solid, foundational and self-sustaining protocol!
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