Proposal seeks to overhaul Aave’s $375 million Safety Module
In a largely celebratory community call devoted in part to commemorating lending protocol Aave’s January 8th “Aaveversary” — a full year of Aave on mainnet — there was also a look into Aave’s possible future: a proposal from Delphi Digital seeking to fundamentally alter Aave’s Safety Module and create a new insurance product offering.
Currently, $aave governance token holders can stake their tokens in the Safety Module, a pool of liquidity designed to help insure the protocol against a “shortfall event” such as a smart contract exploit. Stakers risk up to 30% of funds they lock in the Module, but earn a yield in return (currently 4.66%). The Safety Module pool has attracted nearly $375 million in deposits, comfortably the largest decentralized insurance fund of its type.
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