Defi Giant Aave Rakes in $6M in Revenue as Crypto Market Plunges

Aave shows defiance during the sell-off by profiting off user liquidations.

DeFi protocol Aave generated $6 million in revenue during Monday's crypto market sell-off, according to the platform's founder.

The platform's treasury was rewarded for keeping the markets safe with decentralized liquidations.

Aave Defied Crypto Sell-Off With $6M in Revenue, Says Founder

The platform's founder disclosed the revenue figures in a post on X, a decentralized social media platform.

"Aave Protocol withstood market stress across 14 active markets on various L1s and L2s, securing $21B worth of value," wrote Stani Kulechov. "Aave Treasury was rewarded with $6M in revenue overnight from decentralized liquidations for keeping the markets safe."

The platform generates revenue through a protocol treasury that collects a portion of the interest paid on loans and a "surplus recovery" mechanism that kicks in when a user's collateral is liquidated at a higher price than their outstanding loan.

Aave's revenue is used to fund the protocol's development, compensate contributors and pay for audits, among other expenses.

The sell-off saw more than $1 billion liquidated across crypto derivatives markets, with a further $350 million liquidated on DeFi protocols, according to Parsec Finance.

The total value locked (TVL) on DeFi protocols is now at $71 billion, having dropped from $100 billion at the turn of the month, according to DefiLlama.

Aave's defiant performance during the sell-off is a testament to the platform's resilience and the benefits of decentralized finance in a volatile market.

Aave's revenue generation also highlights the role of DeFi protocols in facilitating efficient capital markets within the crypto ecosystem.

The above is the detailed content of Defi Giant Aave Rakes in $6M in Revenue as Crypto Market Plunges. For more information, please follow other related articles on the PHP Chinese website!