Aave Labs plans to use BlackRock BUIDL shares to help maintain the dollar peg of stablecoin GHO

According to Cryptoslate, Aave Labs has proposed an update to its GHO Stable Module (GSM), which involves using shares of the tokenized BlackRock fund BUIDL to help maintain the dollar peg of its GHO stablecoin.

Under this proposal, the new GSM would allow Aave to exchange USD Coin (USDC) provided by users for BUIDL shares in order to mint its ecosystem's native dollar-backed stablecoin, GHO. These tokens will be stored in a smart contract until users exchange their GHO for USDC. The value of BUIDL shares is stable at $1 per token and pays daily returns to investors each month. The fund distributes its assets as cash, U.S. Treasury bills and repurchase agreements. According to data from RWA.xyz, BUIDL's Assets Under Management (AUM) exceed $502 million.