Aave, a leading decentralized finance (DeFi) platform, has extended its lending markets to the Sonic blockchain as part of its first Layer 1 expansion, which began in 2025. This move was facilitated through a governance vote initiated by the Aave Chan Initiative, a key contributor group within the Aave ecosystem.
Following its transition from Fantom to Sonic, the platform became fully operational, achieving mainnet activation in December 2024. With over $700 million in total value locked (TVL), Sonic now enables Aave users to engage in lending and borrowing activities involving assets such as $USDC, $WETH, and $wS tokens. The integration also incorporates Version 3 (V3) features of Aave, including efficiency mode and gas optimization, enhancing transaction speed and cost-effectiveness.
Revenue Potential Through Fee Monetization
Aave benefits from Sonic’s fee monetization model, which allows the protocol to receive a share of transaction fees, thereby expanding its revenue generation opportunities. The founder of Aave Labs, Stani Kulechov, emphasized that Sonic’s innovative model and the expertise of its development team played a significant role in Aave’s decision to integrate with the blockchain.
To support this launch, Sonic Labs and Aave allocated substantial financial resources. The Sonic Foundation introduced $15 million in incentives and up to 50 million Sonic-native $S tokens. Additionally, Aave contributed $800,000 in stablecoins to enhance platform liquidity and attract users from other networks. These funds are intended to establish a robust and stable market, encouraging participation and seamless migration.
Strengthening Aave’s Position in DeFi
This partnership aligns with Aave’s broader strategy to reinforce its leadership within the DeFi sector. The collaboration benefits from Sonic’s revenue-sharing mechanism, which provides a sustainable framework for decentralized protocols. The platform enables users to supply assets, borrow funds, and earn rewards, mirroring Aave’s existing operations across Ethereum, Arbitrum, and Avalanche. With a total TVL of $19 billion across its supported networks, Aave continues to experience widespread adoption.
It's here.@Aave is now live on Sonic.
🔗 https://t.co/7XBgP08b96 pic.twitter.com/BVgcbEPhLM
— Sonic Labs (@SonicLabs) March 3, 2025
The decision to expand into Sonic followed Aave’s governance resolution to discontinue lending services on Polygon’s Proof of Stake chain. This decision was driven by risk considerations, particularly in response to a rejected proposal related to stablecoin rehypothecation. Kulechov highlighted that risk management remained a top priority for the community, which relied on open discussions to determine the best course of action. Although the Polygon proposal did not pass, Aave chose to exit the chain to ensure long-term stability.
Adapting to a Dynamic DeFi Landscape
Aave’s ability to adapt its strategies in response to changes within the DeFi market demonstrates its flexibility and commitment to innovation. Originally launched as an Ethereum-based protocol in 2018, Aave has since expanded across various Layer 1 and Layer 2 networks. By integrating with Sonic, the platform gains access to an emerging blockchain ecosystem backed by an active and supportive community. As DeFi continues to grow in popularity, Aave’s expansion efforts position it to enhance its service offerings while maintaining its reputation as a secure and reliable decentralized lending platform.
