The article discusses the potential buyback of GHO tokens by the Aave protocol if GHO's market cap reaches another $40 million. GHO stablecoins have been steadily increasing in supply and once they reach the target of 175 million tokens, Aave will initiate buybacks, potentially driving up the price of its native token. Currently, GHO tokens are traded on three major protocols - Curve, Balancer, and Uniswap V3. GHO tokens can be used for yield farming, but their main goal is to play a more influential role in the Aave ecosystem by being used as collateral for lending and liquidity pools.

GHO initially faced selling pressure which caused it to lose its $1 peg and reputation as a stable asset. However, Aave has implemented stricter procedures for borrowing GHO, making its supply growth more sustainable. The Aave community is also discussing borrowing caps to prevent deviations from the $1 tether. The end target for GHO is to reach a market cap of $1 billion and become more valuable after the introduction of revenue sharing.

Aave, which is currently the leading lending protocol with over $11 billion locked in value, is expected to grow thanks to buybacks and additional demand from Spark sub-DAO. However, in the short term, AAVE is seen as risky and may experience temporary selling pressure. Aave also plans to improve its tokenomics by using multiple types of collateral for covering bad loans and introducing the Umbrella safety module. Aave covers the majority of the crypto loan market and has a diverse range of collaterals, with plans to add more in the future.



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