Buy Aave (LEND) in India — Step by Step Guide for Beginners
What is Aave?
Aave, a DeFi money market that allows users to earn interest on cryptocurrency and borrow against it, introduced credit delegation in early July. This service allows someone with a lot of collateral deposited on Aave and no desire to borrow against it to delegate their credit line to a third party they trust.
Aave is a DeFi lending protocol that enables users to lend and borrow a diverse range of cryptocurrencies using both stable and variable interest rates. Aave leverages a native token LEND that provides holders with discounted fees.
Key elements of Aave include:
“Aave” is a Finnish word that translates to “ghost” in English. The ghost represents Aave’s focus on creating a transparent and open infrastructure for decentralized finance. Aave offers quite an impressive range of unique collaterals for any DeFi lending protocol.
1. Flash Loans
Flash loans are one of Aave’s biggest selling points, and that’s especially because you don’t need to deposit any collateral to use them. Instead of using collateral to ascertain payments, flash loans use the timing of the loan’s repayment. Flash loans were invented by Aave, and they work this way:
· Borrowed and repaid in the same transaction
· No collateral needed
· Borrow and return the borrowed amount plus a small interest
· All this needs to happen at the same time, or the transaction will not be approved
Flash loans can be applied in the following kind of scenarios:
· To take advantage of crypto price differences in two or more exchanges without necessarily having the principal amount to do so
· Debt refinancing, or swapping collateral long positions without having to pay the repay the debt of the loan position
2. Flexible Rates
Unlike most lending platforms that use either fixed or variable interest rates, Aave implements a “rate-switching” function that allows borrowers to switch between “stable” and “variable” rates, a very handy feature in the extremely volatile crypto market.
For high-interest rates, a borrower can opt for the fixed-rate, but for volatile rates that might likely take a dip, they can go for the variable rate. Thanks to this new and exciting option, Aave has witnessed particularly strong growth for stable rates loans after their introduction in May 2020.
Note that ‘stable’ here does not imply ‘fixed.’ Rather, Aave’s stable loans are more stable variable interest rates that are resilient against wild price swings. This ability to rate-switch gives users more control over their loans by allowing them to choose the best possible rates.
How to Buy Aave?
You can grab some Aave from any of several exchanges, including BuyUcoin, Binance, MXC, Bilaxy, Bibox, Gate.io, Poloniex, Alderdice, Uniswap, dex.blue, Eterbase, Fatbtc, and Loopring.
As an ERC20 token, LEND can be stored in any wallet that supports Ethereum. You will not go wrong with any of these choices: BuyUcoin Wallet, Atomic Wallet, Trust Wallet, and of course, the hardware wallets (and hence ultra-secure) Ledger and Trezor.
Buy Aave in India — Step by Step Guide For Beginners
BuyUcoin is an exchange that provides buying and to Sell Aave in India as well as other cryptocurrencies. Below is a step by step guide to Aave via BuyUcoin:
Step 1 — Open a Digital Wallet
A digital wallet is where you hold your cryptocurrencies and interacts with others via blockchain technology. There are many providers of digital wallets, however, it is important to make a deep research before you decide which one is the best for you. Currently, the most popular digital wallets provider is BuyUcoin.
Step 2 — Register & Open an Account
Once you enter buyucoin/signup, register and open an account that can provide you with their service. Select the type of your account either individual or corporate. Select your country and agree on the terms and conditions register your account for crypto trading.
KYC and AML are mandatory for Indian jurisdiction. Your data is saved and encrypted and is stored in Indian data centers only. You will be redirected to a different URL to complete your KYC. Please be ready with your recent selfie. You will need the images of your pan card. You will need the mobile number with you which is linked with your Aadhar.
Step 4-Google 2 step Verification
To use 2FA you will have to install an Authenticator app on your smartphone or tablet. Once enabled you will be asked to provide an additional six-digit one-time password along with your email and password every time you login to your BF account. This works only when signing in with email and password. When using Facebook or LinkedIn you can enable 2FA with your social media provider settings.
Step 5-Add Bank details
Add the credentials of your bank name, holder account name followed by account number, and IFSC code details.
Trade Aave (LEND) in India
As of July 30, 2020, Aave is trading at $0.0324118, and with a market cap of $421, 352, 978, it’s the 30th biggest cryptocurrency in the world. Aave has a 24-hour volume of $64, 663,115, and a circulating and total supply of 1, 299, 999, 942. The token’s all-time high was $0.442615 (Jan 07, 2018), and its all-time low was $0.003353 (Sep 06, 2019).
LEND, an ERC20 standard token is the native token of the Aave ecosystem. LEND token holders get the right to make their voice heard on any proposals advanced by the Aave team. Such proposals include interest rates, the addition of new assets, liquid configurations, and so on.
LEND also is burned so as to prevent inflation and increase its value over time. 80% of platform fees are regularly burned on the open market for this end.
In the future, Aave plans to increase the staking ability of users who’ll then get to participate in protocol governance as well as have a claim in exchange fees in exchange for helping secure the Aave network against malicious borrowers.
Can I Use Regular Money to Buy Aave?
Getting started on Save is fairly simple. Visit Aave official website and connect using a web 3.0 wallet such as BuyUcoin, Walletconnect, Coinbase Wallet, or Fortmatic. You can also connect with the Ledger hardware wallet. Depositing is easy. Just select an asset and enter how much you wish to lend.
Next, allow Aave to access the asset. Then, you’ll need to sign to approve the transaction. Your deposited funds will go to the lending pool, after which you start monitoring real-time how much interest you’re gaining on the Aave dashboard.
Aave’s interest-earning tokens are known as aTokens, which are similar to Compound’s cTokens. However, unlike the cTokens, aTokens retain the value of the underlying asset and increase only in amount. On the other hand, cTokens appreciate in value with interest.
Getting an Aave Wallet
Aave version 2 also introduces several new governance features. Now, AAVE token holders can delegate their voting weight to any other address. Aave believes this may lead to the emergence of Protocol Politicians, who will represent the interests of their peers to delegated their votes to them.
But unlike most representative democracies we see around the world today, vote delegation is a liquid democracy so this means a user can instantly remove the delegation in a single transaction if they so wish.
The Aave team also recognizes the pain points of the need to move tokens to another location to participate in governance. So Aave now allows users to be able to sign messages from their cold wallet to participate in Aave Governance. This will in turn reduce the security risk.
Aave Exchanges In India
There are 19 tokens available on Aave. These include DAI, USD Coin (USDC), TrueUSD (TUSD), USDT Coin (USDT), sUSD, Binance USD (BUSD), Ethereum (ETH), Basic Attention Token (BAT), Kyber Network (KNC), ChainLink (LINK), Decentraland (MANA), Maker (MKR), Augur (REP), SNK, Enjin Coin (ENJ), REN, WBTC Coin (WBTC), Yearn.finance (YFI) and Ox Coin (ZRX).
Each asset has a different collateral requirement. This is because of the differences in price volatility. Stablecoins naturally give loan-to-value ratios, due to their price stability. A full breakdown of Aave’s grading process can be found in their Risk Framework.
Aave’s LEND token has rallied by 23% in the past 24 hours and is trading at $0.3440 at press time, according to data source Messari. It’s the day’s top performer among cryptocurrencies with at least $100 million market capitalization.
“The price rally suggests the protocol’s upcoming swap and revamped tokenomics has started to gain steam,” Su Zhu, CEO of the cryptocurrency-focused investment fund Three Arrows Capital, told CoinDesk in a Telegram chat. Three Arrows hold the LEND tokens.
The new model will convert the existing 1.3 billion LEND to AAVE governance tokens in a 100:1 ratio, effectively a reverse split.AAVE holders will be able to stake their tokens in return for new tokens and a percentage of protocol fees.
Given its constant re-invention, Aave’s ghost reference is fitting. Its uncollateralized loans and rate-switching features are two of its radical innovations to ever be seen in the world of finance. And that’s what DeFi is all about: disrupting norms to deliver real value.