Hassan Maishera
On Thursday, Aave Labs announced via X that Umbrella is coming soon to the Aave blockchain. Umbrella replaces Aave's current Safety Module with a new system using aTokens as staking assets.
If bad debt occurs, it automatically burns staked aTokens to cover losses, eliminating the need for governance intervention. When Umbrella launches, the Aave dapp UI will feature a new tab named "Umbrella." In this tab, users can view a variety of aTokens available for staking. Users can stake their aTokens with Umbrella if there are no existing borrows against them.
Furthermore, when staking with Umbrella, users will earn rewards for taking on slashing risks and contributing to the safety of the Aave protocol. These rewards are determined by the Aave DAO and will be displayed in the Aave dapp UI.
Aave protocol is a decentralized, open-source, and non-custodial money market protocol. Depositors earn interest by providing liquidity to lending pools, while borrowers can obtain overcollateralized loans by using the liquidity from these pools. AAVE is trading at $179.25 per token, up 1% in the last 24 hours.
