Aave and Centrifuge tokenize real world assets
Previously, Aave users could only borrow and lend cryptocurrencies, and rates were adjusted based on market demand.
The initiative is in partnership with Centrifuge (CFG), a cryptocurrency company that allows businesses to tokenize aspects of their transactions such as trade receivables and invoices. Once tokenized, these assets can be used as collateral to obtain cash.
Users can lend DAI, a popular decentralized Stablecoin pegged to the U.S. dollar, and receive a 2.8% yield, for example. Conversely, users can borrow DAI at 3.97%. These values fluctuate depending on how much demand for DAI borrowing is compared to the amount of liquidity available for borrowing.
Aave already has 30 additional markets offering the same service, but Centrifuge is claiming regulatory compliance.
