x23.ai

alpha

The Centrifuge RWA Market launches today, the first Aave permissioned market

Reading time saved: 2 minutes

1 replies, 4414 views, 7 likes

governance.aave.com

TL;DR:

The Aave community has launched the Centrifuge RWA Market, a permissioned pool that allows Aave Depositors to earn yield against real-world collateral and Centrifuge Issuers to stake collateral and borrow. This development, managed by RWA Market LLC and planned to transition into a DAO, signifies a major advancement in merging traditional and decentralized finance, offering new yield and liquidity opportunities.

The Aave community has recently introduced the Centrifuge RWA Market, a pioneering permissioned pool utilizing the Aave protocol. This market provides Aave Depositors with the opportunity to earn yield against stable, real-world collateral, while also enabling Centrifuge Issuers to stake collateral and borrow from the market. The RWA Market will initially feature seven pools from Centrifugeā€™s Tinlake protocol across various asset classes. The market will be managed by RWA Market LLC, an independent Delaware limited liability company serviced by END Labs, with future plans to transition the project into a DAO.

To participate, Depositors must complete a KYC process and sign a subscription agreement with RWAM. Once whitelisted, they can provide USDC liquidity to the market and receive aDROP in return. Centrifuge Issuers can signal their intent to borrow and RWAM will purchase their DROP tokens and deposit them into the marketplace. This development means that Aave users can now earn yield against stable, uncorrelated real-world collateral. For Centrifuge Issuers, RWAM will unlock a new source of liquidity by adding Defi composibility between Aave and Tinlake. The DROP tokens used as collateral are designed to be stable, yield-bearing tokens. However, it's important to note that the RWA Market will only support variable rates, with the associated interest rate curve and other risk parameters shared in the post1.

The discussion was opened for questions or comments by Thedoctor_j, who also provided an alternative contact email for further communication. QueenHarleyDean expressed interest in moving forward, although the specifics of their interest were not provided2. This development marks a significant step forward in the integration of traditional finance and decentralized finance, providing new opportunities for yield and liquidity.

Posted 2 years ago

Last reply 2 years ago

Summary updated 2 months ago

Last updated 04/12 15:05