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Executive Summary

This research presents a comprehensive user analysis of GHO, Aave’s decentralized stablecoin, since its launch in July 2023. We identify key user behavior and adoption trends by leveraging on-chain data, subgraphs, and information from third-party providers. Our study reveals several important insights:

• GHO borrowers now represent 10% of all Aave v3 borrowers, with Q1/Q2-24 growth driven more by increased capital from existing users than new borrowers.

• Approximately half of GHO borrowers are new to Aave, suggesting the stablecoin’s potential to attract fresh participants to the platform.

• GHO users demonstrate higher engagement with other DeFi protocols than regular Aave v3 users, indicating a more active user base.

• The introduction of staking incentives has been crucial in stabilizing GHO’s peg and reducing outflows to other stablecoins.

• GHO loans show lower liquidation rates than established stablecoins like USDC and USDT, indicating that GHO users, despite being wealthier and more experienced, do not present higher risk preferences when borrowing.

• User retention remains a challenge, with about 40% of initial GHO borrowers not returning for further interactions.

These findings present a promising landscape for the GHO stablecoin, allowing Aave to capitalize on its unique user base and adapt strategies that foster long-term engagement.