Aave Labs founder Stani Kulechov has confirmed that Horizon, the protocol’s newest initiative targeted on integrating real-world property (RWAs) into decentralized finance (DeFi), is not going to introduce a brand new token.
This choice follows a transparent consensus from the Aave DAO, which opposed the concept of launching a separate token for Horizon.
As an alternative, the DAO reaffirmed its dedication to sustaining $AAVE because the ecosystem’s main governance and utility asset.
General consensus throughout the Aave DAO is that there is no such thing as a curiosity on different tokens. The consensus can be revered, Aave DAO is an actual DAO. RWA exploration will proceed as soon as a proper method is discovered.
There may be solely $AAVE. pic.twitter.com/tQSb51gmvw— Stani.eth (@StaniKulechov) March 16, 2025
The announcement got here through Kulechov’s March 16 publish on X, which talked about that the Aave DAO operates as a very decentralized group and that its governance choices can be honored.
The rejection of a brand new token aligns with issues raised by the group and builders, who argued that a further token might dilute the worth of $AAVE and create pointless complexities within the ecosystem.
Horizon’s Institutional Ambitions and the Function of RWAs
Horizon was formally launched on March 13 as Aave’s strategic initiative to bridge institutional finance with DeFi.
Aave Labs broadcasts Challenge Horizon, a brand new initiative targeted on constructing institutional DeFi merchandise.
Be taught extra:https://t.co/IPruxFuvrH— Aave (@aave) March 13, 2025
The mission’s main providing revolves round permitting establishments to make use of tokenized cash market funds (MMFs) as collateral to entry stablecoin liquidity.
The goal is to place Aave because the main liquidity supplier for RWAs whereas preserving DeFi’s transparency and effectivity.
At its core, Horizon seeks to handle the rising institutional demand for on-chain monetary merchandise.
The rise of tokenized RWAs has been a serious development within the blockchain house, and the worth of on-chain tokenized property has grown considerably.
Based on RWA.xyz, the market has expanded by 19% within the final month alone, reaching $18.63 billion, whereas tokenized U.S. Treasuries have surged 400% year-over-year to $4.26 billion.
Excessive-profile institutional gamers, together with BlackRock, have additionally embraced RWAs, with its tokenized U.S. Treasury fund, BUIDL, surpassing $1 billion in property underneath administration.
A crucial side of Horizon’s technique entails integrating Aave’s native GHO stablecoin as a key liquidity supply for institutional borrowing.
By leveraging good contracts to make sure transparency and over-collateralization, GHO goals to supply a decentralized and steady asset that establishments can confidently use.
Nevertheless, with the DAO’s choice in opposition to introducing a brand new token, Aave Labs should now reassess how Horizon will generate liquidity and income throughout the ecosystem.
Aave’s Governance and the Way forward for Tokenomics
The rejection of a brand new Horizon token aligns with Aave’s broader governance technique, which has just lately undergone important updates by the Aavenomics proposal.
The proposal, launched on March 4, seeks to refine Aave’s tokenomics by specializing in staking rewards, income redistribution, secondary liquidity administration, and the deprecation of LEND, an older token in Aave’s ecosystem.
Aave governance @lemiscate has proposed updates to its tokenomics, introducing Anti-GHO tokens, restructuring staking rewards, and deprecating LEND.#aave #dao #defihttps://t.co/wOx9ubWTFu
— Cryptonews.com (@cryptonews) March 4, 2025
A key ingredient of the Aavenomics replace is the introduction of an Aave Finance Committee (AFC), a governance-backed entity chargeable for managing treasury funds and overseeing liquidity targets.
One other notable factor within the proposal throughout the Aavenomics replace is the introduction of Anti-GHO, a non-transferable ERC20 token designed to exchange the present GHO low cost mannequin.
This token could be distributed to AAVE and StkBPT stakers and could possibly be both burned to offset GHO debt or transformed into StkGHO.
Moreover, a buyback and distribution program has been proposed to additional reinforce $AAVE’s worth.
The preliminary plan suggests allocating $1 million weekly for six months to repurchase AAVE from secondary markets, with potential changes primarily based on treasury studies and finances concerns.
Wanting ahead, whereas the Horizon initiative stays an bold effort to combine RWAs into DeFi, rejecting a brand new token means Aave Labs might want to discover various pathways to fund its growth.
Nevertheless, it’s clear that Aave is making an effort to steer the RWA narrative. As momentum progresses, the corporate will be part of the competitors of these pushing to ascertain RWAs efficiently.
The publish Aave Confirms No New Token for Horizon, Solely $AAVE appeared first on Cryptonews.