Aave Horizon introduces borrowing against tokenized real-world assets through Chainlink SmartData.

Institutions gain access to liquidity while stablecoin lenders receive new yield opportunities.

Horizon strengthens the bridge between regulated finance and DeFi.

Aave Labs has launched Horizon, a lending market on Ethereum designed for institutions and qualified investors. Horizon allows borrowing stablecoins collateralized by tokenized real-world assets (RWAs), establishing a link between centralized finance and decentralized markets for the first time. To achieve this, Horizon uses Chainlink SmartData, first utilizing NAVLink feeds, in a bid to make available proper asset values for collateral.

Aave Horizon Launches With Chainlink to Unlock Institutional RWA Lending 3

This step paves the way for broader integration of Chainlink solutions like Proof of Reserve and SmartAUM. These are features directed towards increased risk management and increased transparency, paving a path for institutional adoption within a regulated setting.

Horizon Launches With Strong Institutional Backing

Horizon’s launch is backed by a strong network of institutions and asset providers. 

Participants include Circle, Superstate, Centrifuge, Ripple, VanEck, WisdomTree, Securitize, OpenEden, KAIO, Ethena, and Ant Digital Technologies. At launch, collateral options feature Superstate’s USTB and USCC, Centrifuge’s JRTSY and JAAA, along with Circle’s USYC.

These assets give investors exposure to short-duration U.S. Treasuries, government securities, and AAA-rated obligations. Stablecoin lenders can provide GHO, RLUSD, or USDC, accessing new yield opportunities generated by institutional borrowers. This creates a dual market where both sides benefit from the inclusion of RWAs in DeFi.

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How the System Operates

Built on Aave Protocol v3.3, Horizon functions as a non-custodial lending infrastructure, ensuring compliance with regulations for permissioned RWAs. Qualified investors deposit tokenized assets, receive non-transferable aTokens, and borrow stablecoins within set loan-to-value limits. Each issuer defines eligibility requirements and manages token access.

It is simple for lenders. Anyone can provide stablecoins, earn in return an aToken generating interest, and withdraw at any time. Llama Risk oversees this with Chaos Labs as a supplementary risk management layer. That is how stability is guaranteed while DeFi is made available for institutional-grade participants.

Aave Positions Itself at the Center of the RWA Market

Horizon values openness and safety above all. Smart contracts handle execution with no intermediaries, while admin controls remain reserved and readable on-chain. Issuers handle compliance checks, whitelisting, and asset handling. Such balancing keeps funds safe while meeting regulatory requirements.

By enabling RWAs as collateral, Horizon unlocks tokenized assets as liquid financial instruments in DeFi. Institutions gain access to liquidity while not having to liquidate their positions, whereas borrowers make repayments in stable yields.

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Filed under: Bitcoin - @ August 28, 2025 10:28 pm