How to Buy Aave at Coins.ph!
Aave is a decentralized lending and borrowing platform built on Ethereum. What it does is really to let users lend or borrow crypto without any middleman. This is made possible by participants themselves providing liquidity so that there are tokens that can be borrowed by other participants. Aave is also the name of the governance token of the Aave protocol.
How to Buy Aave at Coins.ph!
Aave is one of the cryptocurrencies launched on Coins.ph in October 2021, along with MKR, and UNI.
1) Sign up with a Coins.ph account. (If you already have account and is already ID and selfie-verified, proceed to step 3.)
2) Get ID and Selfie-verified.
3) Create an Aave wallet on the app. The option should be immediately viewable once the app is updated to the latest version. (If you cannot see this option, update your app to the latest version.)
4) To buy Aave, just “slide” to convert “Php” to “Aave.”
As a governance token, AAVE is a token that allows its holders to vote on proposals that will determine the AAVE protocol’s future. Hodlers can stake their tokens to vote on proposals for the protocol’s improvement.
Users can start interacting with the Aave protocol after they bought Aave tokens on Coins.ph.
Lending on Aave
Users can deposit funds for others to lend on the Aave protocol. Depositors will in turn receive “aTokens” — Aave interest-bearing tokens that will accrue interest. These interest bearing tokens could be exchanged to the original asset initially deposited, or traded on other platforms.
Borrowing on Aave
As mentioned, loans on Aave are overcollateralized. This means the borrower’s deposit must be larger than what they intend to loan. This is done in order to ensure borrowers just take the loan and disappear. What’s the purpose of borrowing then? The fact is that you are able to borrow without all the approvals needed when doing the same with a traditional loan company. The exchange is of course you need to already have more of the same amount you intend to borrow deposited into Aave.
Despite the mechanism sounding weird (why would I borrow if I already have the funds?) people are still lending and borrowing on Aave because of the protocol’s marquee product — flash loans.
Flash Loans on Aave
In the simplest sense, flash loans allow someone to borrow certain amounts of assets without any collateral, as long as the funds are returned back within the same blockchain transaction.
Once you get Aave from Coins.ph, you can go transfer it to Aave and proceed to earn interest by lending their coins to Aave’s liquidity pool called “safety module.” This safety module is used to cover for funds in case there are incidence of capital shortage.
Why Buy Aave at Coins.ph
As a first-and-foremost a mobile wallet, Coins.ph allows its users to buy Aave in exchange for pesos, instead of buying Aave through USDC in other crypto platforms.
In addition, your gains, if any, from this cryptocurrency can easily be converted back to pesos. Coins.ph is a mobile wallet and it’s possible to pay your bills within the app itself.
This article is published on BitPinas in collaboration with Coins.ph: How to Buy Aave at Coins.ph!