How to Supply and Borrow on Aave

Who should skip this?

Skip Aave borrowing if you cannot watch a health factor, you need a guaranteed rate, or you cannot afford liquidation. Skip a V4 migration if your V3 eMode loop already makes sense. Supply-only is the beginner path. Skip Aave altogether if you wanted a bank: there is no insurance, rates move, and smart contracts can fail.

• You need a protected bank deposit or a fixed savings rate written in a contract with a human
• You want to borrow on day one without ever supplying
• You cannot pay gas on the chain you picked (Ethereum, Arbitrum, Base, etc.)
• You found the URL via a Google ad or a Discord DM

Should you use Aave?

Yes, as the default DeFi lending market if you already have a self-custody wallet and you can live with variable rates and smart-contract risk. Supplying idle USDC or ETH is the usual first job. Borrowing is optional and is how people get liquidated.

Decide V3 versus V4 before you connect. V4 launched on Ethereum on 30 March 2026 with Hub & Spoke accounting — you transact on a Spoke; the Hub holds liquidity. V3 markets still run. Use Compound if you prefer simpler single-base Comet markets. Use Morpho vaults if you want curator-optimised lending yield and you accept curator risk. Use none of them if you still needed an exchange account with a password reset.

What is Aave and how does it work?

Suppliers deposit assets and receive aTokens whose balance grows as borrowers pay interest. Borrowers post collateral and draw another asset, overcollateralised. If the position's health factor hits 1.0, liquidators repay debt and seize collateral at a bonus. Official URLs checked 27 August 2026: app.aave.com (V3) and pro.aave.com (Aave Pro / V4). Type them; do not search-click.

V4 liquidations target a Spoke-level health factor instead of V3’s close factor, and borrow cost can include a user risk premium based on collateral quality. Rates are still utilisation-driven. They are not the Sky Savings Rate and they are not a CEX ‘earn’ product. eMode on V3 raises loan-to-value for correlated pairs such as ETH and stETH — it also concentrates the risk that those assets move together until they do not.

How do you supply (and maybe borrow) without getting wrecked?

Do a supply-only deposit on a cheap L2 first, on the version you meant. Borrow later, at low loan-to-value, on an asset you can repay. If the health factor chart makes you anxious, you are not ready to borrow.

1. 01

   Open the official URL you bookmarked

   app.aave.com for V3 markets, pro.aave.com for Aave Pro / V4. Connect the wallet. Pick a network you already have gas on — Base or Arbitrum is cheaper than Ethereum for a first test. If the UI asks you to pick a Hub or Spoke, write the name down before you supply.

2. 02

   Supply

   Choose USDC or ETH, enter a small amount, approve if needed, confirm. You receive aTokens (or the V4 equivalent receipt). That is a complete first session.

3. 03

   If you borrow

   Enable collateral, borrow far below the maximum, note the health factor. On V4, also note user risk premium and the Spoke’s target health factor. Set a reminder to check after sharp moves.

4. 04

   Repay, then withdraw

   Repay debt plus interest before withdrawing the collateral that backs it. Variable rates can jump when utilisation spikes. Aave will not email you.

Aave vs Compound vs Morpho — which should you use?

Aave is the general-purpose default: more chains, eMode, GHO. Compound V3 is simpler per-market. Morpho is often better rates via matching and MetaMorpho vaults, with curator and isolation trade-offs. Read the dedicated comparisons before moving size; this paragraph is the map, not the verdict for your wallet.

The verdict: should you supply on Aave?

Yes — supply-only, small, on an L2 you already use — if you accept smart-contract risk and variable yield. No to borrowing until health factor is a reflex. No to Aave if you needed a bank.

Next reads: Aave vs Compound, Morpho PT collateral vs Aave isolation, the incident log (including the 25 August 2026 PT-reUSD cascade), the DeFi safety guide, and the live lending APY tool (DeFiLlama snapshot, not a promise). SparkLend is the Sky-flavoured cousin, not a beginner substitute for this flow.