Aave Holders Vote on Proposal to Convert 1,600 ETH From the Network’s Treasury

Most Aave coin holders have voted in support of a governance proposal. This proposal is to determine the fate of the $3 million asset stored in Aave's treasury.

Aave's DAO currently has 1,786.51 awETHH (v2) and over 104.548 ETH tokens in its Collector Contract.

Aave Proposal Gains Impressive Traction

Aave token holders are currently voting on a proposal to convert over 1,600 Ether (ETH), valued at about $3 million, from the protocol fund into Rocket Pool Ether (rETH) and Wrapped Staked Ether (wstETH).

So far, the proposal has gotten over 252,152 votes in support out of 320,000 votes required to date. According to reports, the voting process will end on Friday, July 7, 2023.

The proposal submitted on July 3, 2023, revealed that the Aave decentralized autonomous organization (DAO) presently holds notable amounts of awETH and Ether.

With this proposal, the DAO aims to convert about 104,548 ETH and 1,786.51 awETH (v2) stored in the Collector Contracts into rETH and wstETH. The DAO aims to conduct this conversion to expand the yield obtained from these digital assets.

Presently, the awETH deposit provides a yield of 1.69%, which is comparatively low compared to the yields obtained from rETH and wstETH.

Thus, by converting ETH and awETH to wstETH and rETH, the staking yields can rise to 3.13% and 3.8%, respectively.

This implies that the conversion can benefit the Aave Decentralized Autonomous Organization (DAO) and the crypto's token holders.

Moreover, the proposal provides more solutions than increasing yields; it helps the protocol leverage non-productive digital assets.

This proposal states that the current ETH balance is regarded as non-productive. Thus, by converting them to rETH and wstETH, these digital assets can provide more value and become more productive to the Aave token holders and Aave DAO.

What lies Ahead For Aave?

Aave Network's native cryptocurrency, AAVE, has observed a remarkable recovery along with the overall crypto market in the past three weeks. The token has increased by more than 22% in 7 days and is trading at $74.95.

Also, according to DefiLlama, Aave's current total value locked (TVL) expanded by almost 60% from $3.74 billion in January 2023 to $5.98 billion.

Although Aave has noticed a significant recovery in the past week, some issues still need to be conquered.

The protocol's Total Value Locked (TVL) is still almost 70% low from its peak value of about $20 billion in October 2021.

This indicates that the protocol is still lagging. However, Aave shows a prospective growth in possible yields and activity, offering a chance for investment opportunities.

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