Users and traders can no longer create new GHO stablecoins by minting, but they still can be purchased on secondary markets, says the top Aave contributor.
Marc Zeller, founder of the Aavechan initiative, said demand for GHO has driven the token to its minting cap, meaning that users would be unable to create new coins for the foreseeable future.
However, interested parties can still scoop the stablecoin on secondary markets where GHO trades five cents below its promised $1 peg. The crypto is available on Balancer, Maverick, and Uniswap, per CoinGecko.
Due to high demand, GHO just reached its minting cap.
Now the only way to get obtain gho is on secondary markets.
The GLC will focus on bringing back GHO to 1$, restructuring strong liquidity close to peg before asking governance to increase minting cap.
See u at 1$ ✌️
— Marc Zeller 👻 💜 🦇🔊 (@lemiscate) November 13, 2023
Zeller added that a governance proposal would be introduced to repeg GHO to the U.S. dollar and allow users to mint new tokens. It’s unclear when the proposal will be published and up for a vote in Aave’s DAO, the decentralized autonomous organization responsible for debating and implementing changes to defi’s largest lending protocol.
GHO was introduced in June 2023 as part of a strategy from Aave DAO to bootstrap liquidity, bolster utility, and compete with Maker’s stablecoin DAI.
As crypto.news reported, the token allows Aave v3 users to leverage their Ethereum collateral to secure GHO loans.
Aave’s GHO algorithmic stablecoin | Source: CoinGecko
Additionally, Aave DAO retained rights over GHO interest rates which reportedly reinforced decentralization within the protocol’s community.
While the algorithmic stablecoin initially launched solely on Ethereum’s mainnet, contributors and delegates espoused plans to expand GHO’s availability to other blockchain networks like Arbitrum, Avalanche, and Polygon.
In other Aave-related news, the protocol’s community voted in favor of security updates geared toward addressing vulnerabilities discovered in select markets on Nov. 4.
You might also like: Curve founder repays Aave loan, still owes $42m to defi lenders
