If you keep part of your money in dollar stablecoins between trades or loan payments, it usually sits in a wallet and earns nothing while it waits. A bank would pay interest on the same cash, so decentralized finance (DeFi) protocols built savings vaults, smart contracts that accept a stablecoin and pay a set rate on every deposit.
Savings GHO (sGHO), often searched as Aave sGHO, is that kind of vault for GHO, the dollar stablecoin issued through the Aave lending protocol. On October 1, 2026, about 166 million GHO sat in the sGHO vault on Ethereum mainnet (source: Aave Docs, Savings GHO (sGHO)).
What is sGHO?
sGHO is Aave's savings vault for GHO, deployed on Ethereum mainnet under ERC-4626, the Ethereum standard design for yield-bearing vault contracts. When you deposit GHO, the vault issues sGHO shares to your wallet, each redeemable for a growing amount of GHO as an onchain savings rate accrues (source: Aave Docs, Savings GHO (sGHO)).
GHO is a dollar stablecoin with crypto collateral behind it, and each token is supported by over $1 worth of crypto locked in the Aave protocol. You can get it in two ways: borrow GHO against assets you have supplied to Aave, or swap USDC or USDT for GHO at a 1:1 rate (source: Aave, GHO). Since Aave's v3.4 upgrade, a GHO borrow on the Ethereum Core market draws from GHO that governance minted into the lending pool in advance. Borrowing therefore adds nothing to GHO's total supply (source: BGD Labs, Aave v3.4 features).
The savings rate is funded by protocol income: borrowers pay interest on the GHO they borrow, while the stablecoin reserves behind GHO are held as Aave-wrapped tokens that generate their own yield. That income collects in GHO, and Aave governance decides what portion of it goes to sGHO holders. Your yield therefore arrives as additional GHO, the same token you deposited (source: Aave, GHO).
Only GHO deposited in the vault earns that rate (source: Aave, GHO). An idle GHO balance in your wallet behaves like any of the other crypto-backed stablecoins or stablecoins on Ethereum, a plain holding that earns nothing until you deposit it. Before assuming a balance is earning, confirm that the token in your wallet is sGHO and that it originated from the vault on Ethereum mainnet.
How sGHO shares grow in GHO value
Your sGHO balance stays at the same number of shares, and what grows is the amount of GHO each share redeems for. Inside the vault, an internal yield index grows every second at the configured rate. That growth shows up in the share-to-asset conversion rate (source: Aave, ARFC sGHO Launch Configuration).
Every ERC-4626 vault holds a single underlying ERC-20 token and issues shares against it, and every one offers the same core calls: deposit, mint, withdraw, and redeem. Each vault also exposes read functions, such as convertToAssets, which reports how many underlying tokens a given number of shares is worth, and previewDeposit, which simulates a deposit at the current block (source: ethereum.org, ERC-4626 Tokenized Vault Standard). Because sGHO follows that standard, a wallet, a lending protocol or a portfolio tracker can value your shares through those shared functions using the same code it uses for every other compliant vault.
Suppose one sGHO share redeems for 1.02 GHO on the day you deposit 1,000 GHO, in which case the vault mints 1,000 ÷ 1.02 = 980.39 shares to your wallet. On October 1, 2026, the vault paid a 4.50% annual percentage rate (APR), a yearly rate before compounding (source: Aave Docs, Savings GHO (sGHO)). If that rate holds for three months, a quarter of a year, each share gains 1.02 × 0.045 × 0.25 = 0.0115 GHO and is worth about 1.0315 GHO. Your 980.39 shares then redeem for about 1,011.25 GHO, a gain of 11.25 GHO, while the share count in your wallet stays at 980.39.
The first of two common misreadings comes from a portfolio application that shows only the token count, which will display 980.39 sGHO for as long as you hold. That unchanging number can look as if nothing is happening, so check the GHO value or preview a redemption to see the accumulated growth. The rate is also quoted per year, so a deposit held for one week earns about one fifty-second of the annual figure, which on 1,000 GHO at 4.50% comes to less than 1 GHO. Aave's developer tools report two separate numbers for any wallet: the share balance and the GHO value of those shares (source: Aave Docs, Savings GHO (sGHO)).
How to deposit and withdraw GHO in sGHO
Deposits and withdrawals in sGHO are instant because the vault has no lockup period, no minimum deposit and no cooldown (source: Aave, GHO). You can turn GHO into sGHO shares and redeem those shares for GHO whenever you choose, and the savings rate applies for exactly as long as the shares stay in your wallet.
Depositing through the Aave app follows the same sequence each time:
- Hold the GHO you plan to save on Ethereum mainnet in a self-custody wallet, together with enough ETH to pay gas for two transactions.
- Open the sGHO savings page in the Aave app and connect the wallet that holds your GHO.
- Read the current savings rate on that page and confirm that the vault is open and accepting deposits.
- Enter the amount of GHO you want to deposit and check the number of sGHO shares the preview says you will receive.
- Approve GHO for the vault if your wallet asks for permission, and then confirm the deposit transaction itself.
- Check that the sGHO shares arrived in the same wallet and note the GHO value shown beside them.
The approval step appears only until the vault has permission to move your GHO, and the shares go to the depositing wallet unless an app sets a different recipient. Withdrawing takes a single redeem transaction for all of your shares or an exact number of them, with the GHO arriving in that same transaction and no cooldown in between (source: Aave Docs, Savings GHO (sGHO)).
Deposits are subject to a supply cap, the maximum amount of GHO the vault will accept, which was set at 400,000,000 GHO when the vault launched (source: Aave, ARFC sGHO Launch Configuration). Aave's tools report the most each wallet can deposit and withdraw at any moment. The vault can also be paused, which blocks deposits and withdrawals until it reopens (source: Aave Docs, Savings GHO (sGHO)). A large deposit submitted when the cap is nearly reached can fall short, so review the available capacity in the application before sizing it, and confirm the vault status before planning around a same-day exit.
Slashing and rehypothecation risk in sGHO
sGHO removes two risks that other yield products carry: slashing and rehypothecation. The GHO you deposit stays inside the vault contract, where it is never cut to cover a protocol shortfall or reused by anyone else. The Aave DAO pays the savings yield separately, from the Collector (source: Aave, ARFC sGHO Launch Configuration).
Slashing is the reduction of staked assets to cover a shortfall in the Aave Protocol, a risk that Umbrella stakers accept in return for their rewards (source: Aave, Stake). A shortfall is protocol bad debt, a deficit in a specific asset that the backstop covers (source: Aave, Umbrella). Because sGHO sits outside that backstop, a deficit in one of Aave's lending markets puts no slashing risk on the GHO held in the vault (source: Aave, ARFC sGHO Launch Configuration).
Rehypothecation is the practice of a financial firm using collateral its clients pledged to support the firm's own borrowing or trading, which can leave those clients as unsecured creditors if the firm later fails (source: Investopedia, Rehypothecation). Because your GHO stays in the sGHO contract, the balance behind your shares belongs to sGHO holders and is never lent to borrowers or pledged as another account's collateral. Recovering it depends on the vault itself, with no intermediary's solvency standing between you and your deposit.
Those two properties narrow your exposure considerably, although three separate risks remain whenever you hold sGHO. The vault is a smart contract, and a vulnerability in its code could still endanger deposits. Your savings are denominated in GHO, so if GHO trades below $1, the dollar value of your balance falls even while the GHO amount grows. The yield also depends on governance continuing to fund it, which means the rate can fall as well as rise, so size any deposit with all three risks in mind.
How Aave governance sets the sGHO rate
The sGHO rate is set through Aave governance, where the sGHO Steward contract writes the target rate to the vault. At launch, the Risk Council, a multisig run by Aave service providers, could adjust the rate and the supply cap. Full governance holds the same power over the fixed rate and the cap (source: Aave, ARFC sGHO Launch Configuration).
At launch, the rate was configured as a fixed 4.25% APR, half a percentage point higher than the Sky Savings Rate, the external benchmark it was compared with. Fixed here means the rate follows no outside index, so it stays where the Steward puts it until someone holding the right role changes it. Changes are discretionary and follow GHO growth, market conditions and demand for sGHO. Each one is posted on the Aave governance forum (source: Aave, ARFC sGHO Launch Configuration). Updates since launch have already moved the live rate, so the launch figure describes only where the vault started.
A rate change applies to every share in the vault, including shares you already hold, because the whole vault grows from one yield index. Read the current rate in the Aave application on the day you deposit, treat it as a present-day figure, and verify it again before relying on the same return next month.
Final control over those delegated roles rests with holders of the AAVE token. The Aave Protocol is governed by holders of AAVE, stkAAVE and aAAVE on Ethereum mainnet through proposals, votes and onchain execution. Stewards hold delegated control over specific parameters, including those for the GHO stablecoin, which lets the DAO answer market changes without a vote on every small adjustment (source: Aave Docs, Governance).
That puts AAVE holders at the top of every sGHO rate decision, and the token is also the asset to look at if you want a position in the token that governs Aave, as opposed to a savings balance in GHO. On BloFin, AAVE/USDT Spot buys the token itself, and the AAVEUSDT Perpetual is a contract that tracks the AAVE price with no expiry date.
Before you trade either one, compare the maker and taker fees for your account tier on the BloFin fee schedule, since those fees apply to every order you place.
What replaced the legacy Merit-based sGHO
The current ERC-4626 vault replaced an earlier sGHO, which was the Safety Module's stkGHO renamed, with rewards paid through the Merit program (source: Aave, ARFC sGHO Launch Configuration). Because the legacy contract is being phased out, holders must withdraw GHO and deposit it into the ERC-4626 vault before it can earn today's rate (source: Aave Docs, Savings GHO (sGHO)).
At launch, migration was designed as two manual steps: withdraw GHO from the legacy contract, then deposit it into the ERC-4626 vault the same way as any new deposit (source: Aave, ARFC sGHO Launch Configuration). Legacy withdrawals are instant (source: Aave Docs, Savings GHO (sGHO)). On that manual route, leaving the legacy contract takes two transactions, a cooldown with no waiting period and then a redeem, and your GHO sits idle only until the new deposit confirms. Aave proposal 503, executed on July 7, 2026, then gave a helper contract called the StkGhoMigrator the role it needs to exit stkGHO for you. The helper combines that exit and the sGHO deposit into one flow inside the Aave interface (source: Aave Governance, Proposal 503: Grant Claim Helper Role to StkGhoMigrator).
The launch configuration also set a step-down schedule designed to encourage legacy holders to migrate: in weeks 1 to 3 after the change took effect, the legacy contract paid a fixed 3.75% APR, half a percentage point below the new vault. In weeks 4 to 6 it paid 3.25%, a full point below, before its rewards were set to stop altogether from day 43 (source: Aave, ARFC sGHO Launch Configuration). A balance left on the legacy contract therefore earns less with each phase and nothing once the schedule ends.
The common mistake is to assume that any token labeled sGHO earns the current rate, because both contracts carried the sGHO name. Verify the contract address in your wallet or on a block explorer before treating a balance as current. The ERC-4626 vault sits at 0xE1753F2e00940cC31213dd92013cF019DFE4ca1d on Ethereum mainnet (source: Aave Docs, Savings GHO (sGHO)). On Ethereum mainnet, a token at any other address is either the legacy contract or a wrapper built by another app, so find out which one you hold before you rely on its rate. Aave governance has also proposed bringing sGHO to other networks, with Arbitrum first. Under that proposal, the single vault on Ethereum mainnet stays the source of the savings rate (source: Aave governance forum, ARFC Launch sGHO Cross-Chain).
sGHO vs staking AAVE
sGHO and staking AAVE are separate products, since sGHO takes GHO, pays a savings rate and lets you exit instantly with no slashing. Staking AAVE in the legacy Safety Module earns rewards in a module that was built as Aave's backstop, a role Umbrella has since taken over (source: Aave, Stake).
By February 2026 the maximum slashing for stkAAVE had been set to 0% (source: Aave Governance, Aave DAO Funding Insights). The practical difference between the two today is the exit wait and the token each one pays you.
Exiting a stake takes planning because the process runs in a fixed order: you first activate a cooldown, a waiting period that must end before any tokens leave the module, and then you unstake inside a short window that opens after it. The same sequence applies to Umbrella and to the legacy module: a missed window sends you back to the start, with a fresh cooldown to activate and sit through (source: Aave, Unstake).
| sGHO | Staked AAVE (stkAAVE) | GHO staked in Umbrella | |
|---|---|---|---|
| Asset you deposit | GHO | AAVE | GHO |
| Purpose | Savings | Legacy staking for Safety Incentives | Backstop for deficits in its matching market |
| Slashing | None | 0% (as of February 2026), set by governance | Automatic, based on the deficit |
| Exit | Instant redeem | Cooldown, then a short unstake window | Cooldown, then a short unstake window |
| What you earn | Savings rate paid in GHO | Safety Incentives | Safety Incentives |
The last column is the one that most often catches GHO holders out, because Umbrella, the system that replaced the Safety Module, accepts GHO as well as aTokens. GHO staked there can be slashed automatically when a deficit appears in the market it covers (source: Aave, Stake). The same token therefore carries backstop risk in one contract and savings terms in the other. Read the asset and the contract name in the wallet prompt before you sign, because GHO going into the sGHO vault is a savings deposit, while GHO going into a staking pool is a backstop position with a cooldown.
AAVE appears on both sides of this comparison: it is the token staked in the Safety Module, and its holders govern the roles that set the sGHO rate. If you would like to hold AAVE outside a staking contract, an exchange account lets you buy the token and follow its price directly.
Looking to trade AAVE tokens on BloFin? To get started, you'll need to first create a BloFin account, fund your account with cryptocurrency, then open the AAVE/USDT Spot trading page or the AAVEUSDT Perpetual page.
Frequently asked questions
Can I swap USDC straight into sGHO?
A router contract called GhoRouter turns USDC into sGHO in a single transaction. Without it, the same move takes three steps: deposit USDC into stataUSDC, sell that token for GHO through the GHO Stability Module (GSM), and then deposit the GHO into sGHO. The router runs all three atomically, never holds your funds between transactions, and reverts the whole transaction if the output falls below the minimum you set. It also works in reverse, taking sGHO back to USDC in one step (source: Aave, ARFC sGHO Launch Configuration).
Who can pause the sGHO vault?
The Aave Protocol Guardian, at address 0x2CFe3ec4d5a6811f4B8067F0DE7e47DfA938Aa30, holds the emergency pause role for sGHO. It can pause every non-admin function of the vault and unpause it again later, and that pause power is separate from the rate controls, which the launch configuration gave to the Steward and the Risk Council, and from token rescue, which only full governance can perform. A pause is an emergency control, so the people who can stop the vault are different from the people who set what it pays (source: Aave, ARFC sGHO Launch Configuration).
Has the sGHO contract been audited?
Certora completed a dedicated audit of the sGHO vault and its Steward contract on September 9, 2025, and Sherlock later carried out a separate security review. The vault uses an upgradeable proxy pattern, which means its code can be upgraded after deployment. The wider GHO protocol had been audited 12 times since 2022 by firms including OpenZeppelin, Sigma Prime, ABDK, and Certora. An audit lowers smart-contract risk without removing it, which is worth remembering when you decide how much GHO to put in (source: Aave, ARFC sGHO Launch Configuration).
Is there a maximum rate sGHO can pay?
The sGHO contract caps its rate at 5,000 bps, or 50% APR, through a hard-coded limit called MAX_SAFE_RATE. Below that ceiling, the Steward applies no further onchain limits on how the rate moves, so the launch configuration expects the Risk Council to use discretion, guided by GHO growth and market conditions. The cap works as a safety limit against a mistaken setting and tells you nothing about where the rate will go next, so judge the rate by recent governance updates (source: Aave, ARFC sGHO Launch Configuration).
Does holding stkAAVE change what sGHO pays?
During the switch to the new vault, holders of stkAAVE on Ethereum were set to receive a transitional Stakoor boost of 5% on sGHO, distributed through the Merkl rewards platform on top of the native rate. Seven other boosts from the old Merit program were folded into the base rate at the same time. The Stakoor boost is due to end once the native rate has settled in, so treat it as temporary and confirm whether it still applies before you count it in your return (source: Aave, ARFC sGHO Launch Configuration).
Do I need to claim sGHO rewards?
The base savings rate on the current vault needs no claim, because it builds inside the value of your shares and arrives when you redeem them. On the legacy contract, Merit rewards were paid through Merkl and claimed separately, in the ACI Merit interface or through Aave's developer tools. Withdrawing GHO from the legacy contract keeps any earlier rewards claimable, so check for unclaimed amounts even after you have migrated (source: Aave Docs, Savings GHO (sGHO)). While it runs, the Stakoor boost on the new vault is also paid through Merkl (source: Aave, ARFC sGHO Launch Configuration).
Researched and written by the BloFin Academy editorial team with AI-assisted drafting. Primary sources include Aave's Savings GHO and governance documentation, the Aave GHO product page, the ARFC sGHO Launch Configuration on the Aave governance forum, Aave's staking and unstaking guides, ethereum.org's ERC-4626 reference, and Investopedia. All facts independently verified against cited documentation current as of October 2026.
This article is for informational and educational purposes only. It is not financial, investment, trading, or legal advice. Cryptocurrency can lose value. Borrowing on Aave can lead to liquidation if the health factor drops below 1. Spot AAVE/USDT buys the token. An AAVEUSDT Perpetual is a contract on the price. Do your own research. Consider your circumstances before using any protocol or trading any asset.