Aave launches V3 of its DeFi protocol, expands to six blockchains

Aave V3 sees the leading DeFi lender expand beyond Avalanche, Ethereum, and Polygon.

Aave, one of the leading decentralized finance (DeFi) platforms in the market, has announced V3 of its protocol.

The third version sees Aave expand its liquidity pool to six other blockchains, the platform said in a release.

As per the announcement, V3 going live allows access to the lending protocol’s features to Avalanche, Polygon, Fantom, Optimism, Harmony and Arbitrium. Other than these six blockchains, Aave is set to deploy the latest iteration of its protocol to the Ethereum mainnet.

"Aave V3 is the result of continuous iteration resulting from community involvement and ecosystem growth," said Stani Kulechov, founder and CEO of Aave Companies. 

On what next for the DeFi protocol, Kulechov added:

“V3 brings new and existing Aave community members to participate in the Aave DAO, which will continue to shape the future of DeFi.”

What’s new with Aave V3?

According to Aave, “V3 brings groundbreaking new features that span from increased capital efficiency to enhanced decentralisation.”

1/ Aave V3 is here! 👻  
The most powerful version of the Aave Protocol to date, V3 brings groundbreaking new features than span from increased capital efficiency to enhanced decentralization. Read what's new in V3 in the thread below👇or visit https://t.co/H3jTyKRqNs to dive in! pic.twitter.com/LXzn7660nA

— Aave (@AaveAave) March 16, 2022

Among the new features, Aave users will benefit from enhanced cross-chain asset flow and a 20-25% reduction in transaction costs via gas optimisation. An “isolation mode” will enhance security, while high efficiency will unlock the user’s ability to access even higher borrowing.

Compatibility with different blockchains means DeFi investors on the protocol can seamlessly deposit and borrow assets from one network to another.

For example, a user could deposit on the Polygon chain and proceed to borrow on the Avalanche network. If they wish, they could repay the loan on another blockchain, say Ethereum.

“Along with the launch of V3, there's also a fully redesigned & refreshed Aave app on IPFS where users will be able to access simplified transaction flows, enjoy faster load times, & gain enhanced visibility into their holdings,” the platform said in the announcement.

Users can also access Aave V3 via multiple wallet integrations, including Instadapp, 1inch, DeFiSaver and ParaSwap.