Decentralized finance (DeFi) platform Aave (CRYPTO: AAVE) is launching a new stablecoin called GHO.

What Happened: Aave announced its plans on June 7. The company, which allows you to lend and borrow crypto, released an over-collateralized stablecoin named GHO to be collateralized by assets on the platform to protect against price instability.

The Aave team decided to make GHO a collateralized stablecoin, as opposed to being algorithmic.

Aave touts numerous safeguards to protect GHO from a collapse. The collateral posted for GHO will be varied across numerous cryptocurrencies. Aave has also incorporated features to prevent risk, which will restrict the amount of the stablecoin that can be minted to avoid a de-peg.

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Following the recent launch of numerous stablecoins, Aave’s latest endeavour comes on the heels of a crashing crypto market.