Aave Launches its GHO Stablecoin on Ethereum Testnet

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Aave Companies, the firm behind DeFi platform Aave, has launched the GHO stablecoin on the Ethereum testnet Goerli.

According to the developers of the project, the release of the new asset on the main network should soon be approved by the DAO.

The team presented the GHO project in early July 2022. The instrument is an overcollateralized stablecoin, similar to the model used in DAI by MakerDAO, meaning that in order to issue GHO, users must provide collateral that exceeds the value of the targeted stablecoins.

Assets in collateral will generate returns. Interest income from borrowers of the stablecoin will go to the treasury of the DAO behind the development of the project. The latter will also oversee a set of facilitators who can release and burn GHOs.