Aave and MoonPay Make Strategic Moves in the Crypto Landscape

By: Isha Das

In a significant development within the decentralized finance (DeFi) realm, Aave Labs has initiated Project Horizon, marking a strategic evolution to merge real-world assets (RWAs) with DeFi. Announced on March 13, Horizon seeks to align institutional real-world assets with DeFi’s open financial ecosystem. This initiative intends to bridge the gap for institutional asset issuers, creating a comprehensive framework that promotes broader participation in on-chain finance.

A foundational aspect of Project Horizon is its capacity to integrate compliance with institutional norms while maintaining DeFi’s inherent efficiency and transparency. By leveraging this initiative, institutions will have the opportunity to use tokenized money market funds (MMFs) as collateral for borrowing stablecoins such as GHO and USDC. The plan is to further extend this to other RWAs, thereby enhancing institutional access to the DeFi liquidity pool. A highlight is the profit-sharing model which dedicates 50% of the inaugural year’s revenue to Aave DAO, supplemented by additional incentives to fuel broader ecosystem adoption.

The introduction of Horizon comes at a time of burgeoning growth in the RWA sector, with data indicating a month-over-month surge in total on-chain RWAs, reaching a value of $18.13 billion. This expansion has been spearheaded by substantial growth in on-chain treasuries, now valued at $4.22 billion, reflecting a remarkable 400% growth year over year. Furthermore, prominent financial entities like BlackRock are already deploying tokenized assets, underscoring the potential of RWAs to scale immensely in the next decade.

In tandem with these developments, MoonPay, a cryptocurrency payments firm, has further solidified its footprint in the stablecoin ecosystem by acquiring Iron, an API-focused stablecoin infrastructure platform. This acquisition, announced on the same day as Project Horizon, enables MoonPay’s enterprise clientele to facilitate stablecoin payments with seamless immediacy and minimal cost. Moreover, this integration empowers businesses to dynamically manage stablecoin treasuries and engage in acquiring yield-bearing financial instruments such as US Treasury bonds. MoonPay’s strategic acquisition of Iron underscores its commitment to broadening its influence and capabilities within the enterprise blockchain sphere.