Aave brings V3 lending and GHO stablecoin to Monad with $15M in incentives
The largest DeFi lending protocol expands to Monad's high-throughput Layer 1, backed by a substantial first-year incentive package from the Monad Foundation
Aave has deployed its V3.7 lending protocol on Monad, listing 12 assets and activating its native GHO stablecoin on the high-throughput Layer 1 network. The Monad Foundation is committing $15 million in first-year incentives to jumpstart liquidity and adoption.
What the deployment looks like
The Aave V3.7 instance on Monad supports 12 assets, including USDC, USDT0, and GHO. These assets have been activated in specified efficiency modes, or eModes, which allow users to borrow at higher loan-to-value ratios when their collateral and borrowed assets are correlated in price.
Alongside the lending protocol, GHO, Aave’s native stablecoin, will go live on Monad to support borrowing and liquidity functions. The stablecoin has previously expanded to Base and Arbitrum since its initial introduction in mid-2023, and the Monad deployment follows that same cross-chain playbook.
10 million GHO tokens will be acquired and held for over six months as part of a broader effort to seed liquidity on the platform.
Monad’s pitch and why Aave chose it
Monad launched its mainnet and MON token on November 24, 2025, positioning itself as a low-latency, EVM-compatible Layer 1 built for demanding use cases. The network targets fintech applications, neobanks, and high-frequency DeFi.
The Aave DAO’s proposal cycle began with a Temp Check on February 24, 2026, and progressed through to AIP voting by late June 2026 with near-unanimous support.
GHO’s activation on Monad relies on Chainlink’s Cross-Chain Interoperability Protocol, or CCIP, which handles the bridging infrastructure needed to move the stablecoin between networks.
What this means for investors
The $15 million incentive commitment from the Monad Foundation is substantial, but incentivized liquidity is rented liquidity. Investors should watch utilization rates and organic borrowing demand as leading indicators rather than fixating on raw TVL numbers.
Every new chain where GHO gains a foothold expands the stablecoin’s addressable market and generates revenue for the Aave DAO through interest on GHO borrows. Investors holding AAVE tokens should consider that each successful multichain deployment incrementally increases the protocol’s fee-generating surface area.