TechFlow News — On March 3, according to The Block, the decentralized lending protocol Aave has deployed its lending market on Sonic (formerly Fantom), marking Aave’s first expansion onto a Layer 1 blockchain this year.
The deployment of Aave v3 follows the approval of a governance proposal put forward by contributors and representatives of the Aave Chan Initiative. According to Aave, Sonic's monetization model allows decentralized protocols like Aave to receive a share of transaction fees generated by user activity, potentially serving as an additional revenue stream for Aave.
Stani Kulechov, founder of Aave Labs, said: "Sonic's focus on its innovative revenue-sharing model and the team's expertise creates a compelling opportunity for Aave to expand its reach and engage with a growing community-driven DeFi ecosystem."
This expansion is backed by liquidity support including $15 million in funding from the Sonic Foundation, up to 50 million of Sonic’s native tokens $S, and $800,000 in stablecoins and migration incentives from Aave.
Meanwhile, Aave’s governance has decided to sunset its lending operations on the Polygon PoS chain due to risks associated with Polygon’s previously proposed plan to restake stablecoins via its native bridge. Although Polygon ultimately rejected the proposal, this did not alter the stance of Aave contributors.
