In this article, we will look at a DeFi service called AAVE, which provides its users with the opportunity to earn passive income without any volatility risks.

What is aave.com?

AAVE is a decentralized financial service developed on the basis of Ethereum smart contracts. In simple words, it is a "blockchain bank" with its own deposits and loans. Let's understand the conditions of its use in more detail.

Deposit with AAVE

Everyone knows that the simplest way to get passive income is a bank deposit at ~5% per annum. Each bank has its own conditions for deposits, both in terms of limits and terms. AAVE differs from traditional banks in that it has no deposit limits and terms. An AAVE user can make a deposit for any amount and for any term, with instant withdrawal at any time.

We recommend to make a deposit on AAVE in stablecoins, which are liquid and freely traded on many exchanges. The main feature of stablecoins is zero volatility, unlike classic cryptocurrencies.

AAVE implements support for more than a dozen different assets. For example, deposits in TrueUSD (TUSD) steiblcoins will accrue 6.07% per annum. This yield is almost identical to ruble deposits, but let's look at dollar deposits, for which the indicator is no more than 2%.

As a result, AAVE offers an excellent rate on dollar deposits, and without any terms or limits.

Credit at AAVE

A cryptocurrency loan can be obtained against collateral. That is, the user of AAVE will not be able to get the assets without any collateral. And the amount of collateral must be greater than the loan amount.

However, the collateral will work as a deposit with the accrual of interest, which we discussed above. What do you get? You make deposits at 6% and take a loan at 5%. You end up staying on the plus side.

Unlike other similar services, AAVE realizes support for two rates on loans: floating and stable.

AAVE also boasts a low one-time fee on the loan amount (0.25%). If you take out a $100 loan, your debt will be $100.25 + annual interest. But you can use AAVE through the defi.timvi.com interface to get a 12% cashback on that fee. This is made possible through AAVE's partnership with Timvi, a commission-free service that allows AAVE users to receive additional funds.

The decentralized finance (DeFi) market is developing at a rapid pace and new projects are emerging every day.