The Aave community is currently voting on new governance proposals to expand the GHO stablecoin ecosystem. One notable proposal involves creating a yield-generating savings coin called “sGHO.” If approved, this coin will introduce a new “Aave Savings Rate,” focusing on providing users with returns.
sGHO Coin’s Yield Mechanism
The Aave Chan Initiative has designed sGHO as a “low-risk savings product.” Users will earn interest by depositing their GHO coins into the sGHO system, which will provide interest earnings through the Aave Savings Rate. In return, users will receive a receipt coin in ERC-20 format, appreciating over time.
This system aims to ensure continuity based on the revenue from the existing Aave ecosystem. The GHO coins deposited for sGHO will remain locked within the system without being reused, thereby minimizing risk. The interest rate will be determined based on market supply and demand.
Strategies to Increase GHO Coin Usage
sGHO emerges as part of several initiatives by Aave to enhance GHO stablecoin usage. Users will not incur any deposit or withdrawal fees, making this savings product advantageous compared to others in the market.
Additionally, Aave has proposed using GHO as a gas coin across various Blockchain networks. This proposal received 100% support two days ago. Individual proposals are also being made to transfer GHO to the Fluid ecosystem, Arbitrum, and other networks.
Furthermore, the Aave DAO recently implemented new financing arrangements to improve protocol liquidity and reduce risks. Recent governance decisions have led to the reallocation of assets like USDC, DAI, BAL, and CRV from the Aave v3 protocol to the Ethereum 
$2,316 main network. This step aims to support the use of “native USDC” within Aave.
