Ethereum users optimistic about the launch of Aave liquidity mining

key takeaways

  • OP token liquidity mining is now active on Aave’s version of Optimism.
  • Aave on Optimism has seen a 493% increase in deposits since the update went live.
  • The liquidity mining program also helped push Optimism’s total value to over $1.5 billion.

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A new liquidity mining initiative on Aave helped push the total value locked in Optimism above $1.5 billion.

Optimism launches liquidity mining on Aave

Optimism has launched another round of token rewards.

Ethereum Layer 2 Network Announce Its latest liquidity mining program kicked off Thursday as part of the chain’s so-called “OP Summer.” The project has allocated 5 million OP tokens to DeFi lending giant Aave for distribution to its users over the next 90 days.

Since the update went live, users have bridged hundreds of millions of dollars in tokens to Optimism and deposited them into Aave to earn additional OP tokens.according to Data from Defi Llama, Aave deposits on the Layer 2 network have increased by 493% in the past 24 hours. At press time, Aave V3 on Optimism has nearly $420 million worth of assets locked in its smart contracts.

While the Aave liquidity mining program is the largest Optimism program to date, it is not the first.Several other protocols have started since Ethereum Rollup launched its native OP governance token in May Distribute Rewards. These include automated market maker Velodrome, decentralized swaps app Perpetual Protocol and sports betting app Overtime Markets.

Thanks to its OP token incentives, Optimism has significantly increased its user base and the total value of assets locked in on-chain smart contracts.according to L2Beat datathe total value locked in the network, excluding its native OP token, has 63% increase Since the launch of the OP token on May 31st. Recently, the launch of Aave liquidity mining pushed the total value up by 27%. The total value locked in Optimism is currently around $1.51 billion, second only to Arbitrum’s $2.48 billion in the Tier 2 competition.

Optimistic total value locked (source: L2 beat)

Optimism is one of the major layer 2 projects working on scaling Ethereum. It uses Optimistic Rollups to bundle transactions together and send them back to the Ethereum mainnet for confirmation. Aggregations like Optimism save users a lot of gas compared to transacting on the mainnet. E.g, L2 fee data The current cost of exchanging tokens on Optimism is shown to be $0.36, compared to $6.49 on Ethereum.

Disclosure: At the time of writing, the author owns ETH and several other cryptocurrencies.

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