# Increase GHO Borrow Rate 100 bps to ~6.41% on Aave V3
AI summary
This proposal aims to increase the borrow rate for GHO, Aave's decentralized stablecoin, by 100 basis points (1%) on Aave V3. The rate will go from 5.22% APR to 6.22% APR. This change is part of an ongoing strategy to help GHO maintain its intended value (peg) to the US dollar, as its price has recently been slightly below $1. The Aave-chan initiative (ACI) will continue to propose similar increases if GHO's price remains outside its target range.
If this proposal passes, borrowers of GHO will pay more interest, which could make borrowing GHO less attractive. This is intended to reduce the supply of GHO and help its price return to $1, benefiting GHO holders. GHO borrowers will face higher costs.
Voting results
🐳 Whale votes
0 votes > 5% VPFull proposal
Increase GHO Borrow Rate 100 bps to ~6.41% on Aave V3
title: "Increase GHO Borrow Rate 100 bps to ~6.41% on Aave V3" author: "Alice Rozengarden (@Rozengarden - Aave-chan initiative)" discussions: "https://governance.aave.com/t/arfc-increase-gho-borrow-rate-100-bps-to-6-35-on-aave-v3/15744"
Simple Summary
This AIP proposes an increase in the GHO borrow rate from 5.22% APR to 6.22% APR to support the GHO peg restoration and align borrowing costs with market rates.
Motivation
AIP-381 allows for 100 bps increases in the GHO bor…