AAVE V2 Facing Low Demand and Possible Deprecation
The Aave Community is currently voting on the ARFC proposal to “Deprecate Aave V2 AMM Market” on April 24th at 8:00 PM UTC. This comes after a low demand for the V2 market and the decision to pool together liquid assets onto a single protocol.
The Aave community initiated a proposal to freeze the BUSD reserve on the Aave V2 Ethereum market: As there’s no real prospect of growth and the inability to mint new BUSD might hurt peg arbitrage opportunity and asset peg. It seems that the most reasonable path for Aave is to…
— Wu Blockchain (@WuBlockchain) February 13, 2023
Proposed Changes to the V2 Market
The proposal recommends leaving the AMM V2 market due to its low use rate and the fact that only a few primary assets like DAI, USDC, USDT, WBTC, and ETH are accessible in the market. This involves freezing all assets except these primary assets and lowering the liquidation bar to zero for all LP tokens. It will also dissolve the Aave V2.
The Future of the V2 Protocol
The vote is likely to pass, but it doesn’t mean that Aave will discontinue the V2 protocol entirely. The V2 protocol will probably still be around, but with some changes.
Humorous Comparison to an Unpopular Kid
It’s like the V2 market is the unpopular kid in school, and nobody wants to hang out with it. Maybe it’s time for the V2 market to reinvent itself, get a new haircut, and come back with a bang. Or, maybe it’s time to accept that the V2 market isn’t the right fit and move on to something new.
A Brave Community Making Tough Decisions
Whatever the outcome, the Aave community is showing that they’re not afraid to take a stand and make tough decisions. It’s like when you’re at a restaurant, and everyone wants to order something different, but someone takes the lead and makes the final call. The Aave community is that person.
In conclusion, the future of the AAVE V2 protocol is uncertain, but the Aave community is taking steps to address its low demand. Will the V2 market rise from the ashes like a phoenix or be left behind in the dust? Only time will tell.
(AAVE V2 Facing Low Demand)