Bitcoin Mining: Aave's Crazy Project That Makes You Dream... Or Tremble

The Aave community is exploring new avenues to increase its revenue by considering Bitcoin mining. This initiative, proposed by Blockware Solutions, aims to integrate Aave’s stablecoin GHO into the BTC network while sparking discussions about profitability and associated risks.

Aave considers Bitcoin mining to boost its revenue!

According to a proposal dated January 15, Aave would engage Blockware to operate Bitcoin mining equipment on its behalf, seeking to achieve a solid annualized net return of 33.03% for Aave’s treasury. Bitcoin mining “not only strengthens the protocol’s balance sheet, but also opens the door to significant capital gains tax depreciation strategies,” Blockware stated.

Furthermore, the DeFi protocol would also integrate its stablecoin GHO directly into the Bitcoin network! This would allow BTC miners and retail clients to pay for mining equipment with AAVE (GHO), according to the proposal. Additionally, integrating GHO into the BTC network would establish GHO as a “Bitcoin-powered stablecoin with real value,” according to Blockware. This initiative could potentially open new opportunities for Aave and strengthen its position in the DeFi ecosystem.

A doomed proposal?

However, discussions on Aave’s governance forum reveal a degree of skepticism among token holders. They express concerns about the costs associated with Bitcoin mining. Some community members have even voiced doubts about the profitability of the proposal, noting that several publicly traded BTC miners are not profitable on a cash flow basis.

Moreover, despite the recent spectacular rise of BTC, mining company stocks are collapsing, illustrating the structural challenges and high costs they face. Given this skepticism, what decision will the Aave community make?

Although Aave’s Bitcoin mining proposal presents potential benefits, it also raises legitimate concerns among community members. The final decision will depend on the vote of token holders and the assessment of the risks and benefits associated with this initiative.