Author: WEHODL Translation: Shanooba, LianGuai
Aave and Compound are two of the most popular decentralized finance (DeFi) lending protocols. They allow users to lend and borrow cryptocurrencies and provide various features for borrowers and lenders.
Recently, both Aave and Compound have released new versions of their protocols: Aave v3 and Compound v3. These new versions have many improvements compared to the previous versions, such as lower fees, more liquidity, and new features.
Side-by-Side Comparison
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Here is a basic comparison of the features between the latest versions of the two protocols:
Which Protocol is Right for You?
The best protocol for you will depend on your personal needs and preferences. If you are looking for a protocol that supports a wide range of assets and offers variable or stable borrowing rates, then Aave v3 is a good choice. If you are looking for a low-cost and permissionless lending protocol, then Compound v3 is a good choice.
Ultimately, the best way to determine which protocol is right for you is to try both protocols and see which one you prefer.
Here are some additional details about the main differences between Aave v3 and Compound v3:
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Supported Assets: Aave v3 supports over 200 cryptocurrencies, while Compound v3 supports over 100 cryptocurrencies. This means that Aave v3 has a wider range of assets available for lending and borrowing.
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Borrowing Rates: Aave v3 offers variable or stable borrowing rates, while Compound v3 only offers variable borrowing rates. Stable rates act as fixed rates in the short term but can be rebalanced based on market conditions in the long term. Variable rates are based on loan quotes and demand on each protocol, Aave v3 or Compound v3.
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Liquidity: Both Aave v3 and Compound v3 have high liquidity, which means there are plenty of borrowers and lenders available. This makes it easy for you to get a loan or lend out your cryptocurrencies.
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Fees: Aave v3 charges higher fees than Compound v3. This is because Aave v3 offers more extensive features, such as flash loans and isolated markets.
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Features: Both Aave v3 and Compound v3 offer multiple features, such as flash loans, collateral swapping, and permissionless lending. However, Aave v3 also offers some features that Compound v3 does not have, such as the ability to mint synthetic assets.
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Security: Both Aave v3 and Compound v3 have been audited by security firms, which means they are considered to be secure. However, it is worth noting that no DeFi protocol can be completely immune to hacking attacks.
Conclusion
Aave v3 and Compound v3 are both excellent DeFi lending protocols. They offer extensive features, low fees, and high liquidity. The best protocol for you will depend on your personal needs and preferences.
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