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TVL $413MAPY 0.09%low riskUpdated Feb 1, 2025

Aave Ethereum LINK

Supply LINK to Aave V3 on Ethereum to earn interest. LINK is Chainlink's token, essential for the oracle infrastructure that secures DeFi.

ProtocolAave V3
Networkethereum
SymbolAETHLINK
CategoryMoney Markets
Underlying Assets
LINK
Contract Address0x5e8c8a7243651db1384c0ddfdbe39beeb33b6996

What is Aave Ethereum LINK?

Aave Ethereum LINK is a lending market for Chainlink's LINK token on Aave V3. LINK powers the Chainlink oracle network, which provides price feeds and external data to most DeFi protocols, including Aave itself. This creates an interesting dynamic where LINK underpins Aave's security while also being a tradeable asset within it.

How This Market Works

LINK lending follows standard Aave mechanics:

  1. Deposit LINK into the Aave V3 lending pool
  2. Receive aETHLINK tokens representing your deposit
  3. Earn interest from LINK borrowers
  4. Withdraw LINK plus accrued yield anytime
Low Supply Rates: Like other volatile assets, LINK typically has lower supply APY because most holders use it as collateral for borrowing stablecoins rather than borrowing LINK itself.

What Assets Are Involved

Supply Asset: LINK (Chainlink Token) Receipt Token: aETHLINK - Aave deposit token

LINK in Aave is primarily used as:

  • Collateral for borrowing stablecoins without selling LINK
  • Collateral for leveraged LINK positions
  • Earning minimal yield while maintaining LINK exposure
  • Node operator capital efficiency strategies

Chainlink's Role in DeFi

LINK and Chainlink are foundational to DeFi:

  • Price Feeds: Provide collateral valuations for lending protocols
  • VRF: Verifiable randomness for games and NFTs
  • Automation: Keeper networks for protocol maintenance
  • CCIP: Cross-chain interoperability protocol

The security of most DeFi protocols, including Aave, depends on Chainlink oracle accuracy.

Risk Disclosures

Smart Contract Risk: Standard Aave V3 contract risks apply. Price Volatility: LINK is a volatile asset. Its value can fluctuate significantly, affecting collateral ratios for borrowers using LINK as collateral. Oracle Irony: LINK's value in Aave depends on Chainlink oracles. While this creates alignment, it also means oracle issues could affect both LINK pricing and broader protocol health. Utilization Risk: Low LINK borrowing demand means limited supply yields. This could change with new LINK staking or utility developments. Token Utility Risk: LINK's value depends on continued Chainlink adoption and the broader oracle market. Competition or technology changes could affect demand. Staking Migration: Chainlink's staking program may affect liquid LINK supply, potentially impacting Aave market dynamics. Concentration Risk: Large LINK holders (including Chainlink treasury) could significantly affect market dynamics.

Related Money Markets

Aave Ethereum WETH1.25% APYAave Ethereum USDT2.45% APYAave Ethereum wstETH0.01% APYAave Ethereum USDC3.47% APYAave Ethereum WBTC0.01% APY
Disclaimer: APY and TVL figures are based on on-chain data and may fluctuate. Past performance does not guarantee future results. DeFi investments carry smart contract, market, and liquidity risks. This content is for informational purposes only and does not constitute financial advice. Always conduct your own research before investing.

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