Aave

Represents value derived from controlling the decision-making in Aave DAO, such as AIP voting and protocol parameters. Both staked and not staked AAVE hold the voting power.

Represents the still-extant allocation of yield to the AAVE staked in the legacy Safety Module. The allocation will be gradually decreasing along with the slashing risk (the slashable relative volume of stkAAVE) until the slashing risk is eliminated and a residual yield, which may be nonzero, is assigned to stkAAVE.

Both parameters are adjusted via AIPs. Read the most recent AIP to learn more.

This mechanism represents the infrastructure built to incentivize and support AAVE staking to fill up the Safety Module and protect users from bad debt.

However, the importance of this mechanism will steadily decline as Umbrella phases out the Safety Module entirely because, unlike stkGHO, stkAAVE has no Umbrella counterpart.