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Aave wants to tokenize Tesla
Aave wants to tokenize Tesla
Blockchain

Aave wants to tokenize Tesla

By Alfredo de Candia - 21 Aug 2020

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It seems almost a provocation made by the founder and CEO of Aave, Stani Kulechov, directed at Elon Musk and Tesla, in wanting to use the cars as collateral for the Aave protocol:

It should be noted that the Aave protocol, dedicated to lending and borrowing, allows providing liquidity to various pools of different assets, and also allows borrowing assets by paying interest, in addition to a flash loan feature.

According to the CEO, his idea would be to use a physical asset, such as Tesla cars, so that users can borrow a percentage of their value to use, without having to sell their car.

Aave and Tesla, it’s not a senseless proposal

Someone could make the accusation that this type of system would not be at all conceivable and practicable, especially with a car, and yet it is completely possible and already attempted. We are talking about the pledge institution, i.e. a user brings his material property, then after an evaluation of the object, he is given a sum of money with respect to the object left, with the obligation to return the sum in a certain time including interest.

In this case, it would not be difficult to imagine a 4.0 pledge bank where people leave or sell their goods in exchange for crypto using the physical object as collateral, with a smart contract linked to it. 

The asset itself would be tokenized, making it digital, which with an NFT (Non Fungible Token) would not only become feasible but would also open the door to the sale of a physical asset through an NFT.

This is a long-term investment, a sector that does not currently exist. It is therefore difficult to predict the development of such a system, but it is certainly possible to do a similar project. Indeed, it could be the next sector that applies decentralized finance to the material world.

Alfredo de Candia
Alfredo de Candia

Android developer for over 8 years with a dozen of developed apps, Alfredo at age 21 has climbed Mount Fuji following the saying: "He who climbs Mount Fuji once in his life is a wise man, who climbs him twice is a Crazy". Among his app we find a Japanese database, a spam and virus database, the most complete database on Anime and Manga series birthdays and a shitcoin database. Sunday Miner, Alfredo has a passion for crypto and is a fan of EOS.

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