GHO (GHO) — Complete Guide

GHO is the native stablecoin of Aave Protocol, launched on Ethereum mainnet in July 2023. Unlike USDT or USDC, GHO is minted by Aave users by posting collateral in the Aave lending market — the same process as taking a loan. GHO has grown to over $200M in supply and is part of Aave's strategy to capture stablecoin revenue rather than paying external issuers. stkGHO stakers in the Safety Module earn discounted borrowing rates.

Aave v3 users with sufficient collateral deposited can mint GHO at a governance-set borrow rate (currently around 6–8% APY). GHO is minted when users open a GHO borrow position and burned when they repay. The over-collateralization ratio is determined by Aave's existing risk parameters for each collateral asset. Facilitators — other protocols approved by Aave governance — can also mint GHO against different collateral types (e.g., FlashMinter for flash loan arbitrage). GHO holders can stake in the Aave Safety Module as stkGHO, which earns AAVE token rewards and is the primary liquidity backstop.

• +Native to Aave — the largest DeFi lending protocol by TVL, with $20B+ in assets
• +Borrow rate is governance-controlled and currently below market, subsidized for adoption
• +stkGHO staking provides AAVE rewards and reduced borrowing rates for aligned holders
• +Multi-chain expansion to Arbitrum and Avalanche via Aave's cross-chain infrastructure
• +GHO revenue accrues to Aave DAO treasury — creates sustainable DAO revenue model
• +Deeply integrated with Aave's existing risk framework and oracles

• !GHO has de-pegged below $1 multiple times due to excess minting versus demand
• !Borrow rate subsidies are unsustainable long-term and will increase as the protocol matures
• !Smart contract risk inherited from Aave v3 — a critical Aave bug would impact GHO