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sGHO — Aave Savings Stablecoin — GHO — Stablecoins for Savings — analysis

Savings GHO (sGHO) from Aave: Full 2026 Review

Savings GHO (sGHO) is Aave’s yield-bearing version of GHO, offering ~5.6% APY with instant liquidity, no lockups, and low risk. Full 2026 review.

,   and  Alex
4 min read
sGHO

Table of Contents

The Savings GHO (sGHO) product is Aave’s answer to a simple question many DeFi users now ask first: where can I park stablecoins with minimal risk, full liquidity, and transparent yield?

Accessible via https://app.aave.com/sgho/, sGHO is the official savings interface for Aave’s native stablecoin, GHO. As of 2026, it has become one of the cleanest, lowest-friction yield products in DeFi.

This article provides a complete, up-to-date review of how sGHO works, why it exists, and how it compares to other stablecoin yield options.

What Is sGHO?

sGHO (Savings GHO) is the yield-bearing version of GHO, Aave’s decentralized, overcollateralized USD-pegged stablecoin.

When you deposit GHO into the Savings GHO contract, you receive sGHO, an ERC-20 receipt token. Your sGHO balance represents a claim on your original GHO plus accrued rewards, which grow automatically over time.

Conceptually, sGHO functions like a non-custodial, on-chain savings account:

  • Deposit GHO
  • Hold sGHO
  • Withdraw anytime
  • Earn variable yield without lockups, slashing, or rehypothecation

The product was explicitly designed to replace earlier staking-style models (such as stkGHO) that introduced cooldowns, complexity, and principal risk.

Key Features and Metrics

sGHO Savings Stablecoin
  • Current APY: 5.61%
    • Variable, driven primarily by:
      • Aave’s Savings Rate mechanics
      • Rewards allocated via the Merit program
  • Total Deposited: Approximately $254.17 million
  • Token Price: $1.00
    • sGHO tracks GHO 1:1; yield is reflected in increasing redeemable value, not price appreciation
  • Liquidity: Instant withdrawals, no cooldowns
  • Risk Profile: No slashing, no rehypothecation, no leverage by default
  • Reward Distribution: Paid in GHO and claimable via Merit

From a UX perspective, sGHO is one of the simplest yield products in DeFi today.

How Savings GHO Works

The sGHO flow is intentionally minimal:

  1. Connect your wallet at https://app.aave.com/sgho/
  2. Deposit GHO
  3. Receive sGHO (ERC-20 receipt token)
  4. Your position accrues rewards automatically over time
  5. Withdraw at any moment by burning sGHO for GHO + earned yield

Although rewards are distributed through Aave’s Merit system, the user experience is effectively auto-compounding.

You do not need to manage strategies, claim and restake manually, or monitor positions for liquidation risk.

Where the Yield Comes From

sGHO yield is protocol-native, not financial engineering:

  • GHO borrowing fees
  • Governance-approved emissions
  • Savings Rate parameters set by Aave DAO
  • Merit-based reward allocations

Importantly, deposited GHO is not re-lent or rehypothecated. This makes sGHO fundamentally different from lending pool yields, money market looping, or structured yield vaults.

As a result, APY tends to hover around or slightly above GHO borrow rates, adjusting dynamically with demand and governance decisions.

sGHO vs. stkGHO (Why the Change Matters)

Aave deliberately moved away from the stkGHO model for passive holders.

stkGHO drawbacks included:

  • Cooldown periods before withdrawal
  • Slashing risk tied to protocol shortfall events
  • More complex mental model for new users

sGHO improves on this by offering:

  • Instant liquidity
  • Zero slashing risk
  • No lockups
  • Cleaner onboarding for stablecoin savers

The result is a product optimized for capital efficiency and simplicity, not protocol insurance.

Risks to Understand

While sGHO is among the lowest-risk DeFi yield options available, it is not risk-free.

1. Variable Yield

APY is not fixed. It depends on:

  • GHO borrowing demand
  • Merit reward allocations
  • Aave governance changes

2. Smart Contract Risk

sGHO relies on Aave’s smart contracts. Aave is heavily audited and battle-tested, but smart contract risk can never be fully eliminated.

3. Peg Risk

sGHO tracks GHO, not fiat USD directly. GHO maintains its peg through overcollateralization and arbitrage, but extreme market events could cause temporary deviations.

Notably, there is no liquidation risk and no leverage risk unless you introduce leverage yourself.

How to Get Started with sGHO

To use Savings GHO, you first need GHO:

  • Mint GHO by borrowing against collateral on Aave
  • Swap into GHO on supported DEXs
  • Bridge GHO cross-chain if applicable

Then:

  1. Visit https://app.aave.com/sgho/
  2. Connect your wallet
  3. Deposit GHO
  4. Hold sGHO and earn passively

Some advanced users choose to loop (borrow GHO → deposit into sGHO) to increase effective yield. This adds leverage and liquidation risk and should only be considered by experienced users.

Why sGHO Matters in 2026

sGHO is more than a yield product. It represents a broader DeFi trend:

  • Protocol-native stablecoins
  • Transparent, governance-controlled yield
  • Low-friction onboarding
  • No unnecessary financial engineering

For Web3 builders and marketers, sGHO is also an excellent onboarding primitive. It demonstrates how DeFi can deliver value comparable to traditional savings products without custody, lockups, or opaque risk.

Summary

Savings GHO (sGHO) is one of the cleanest stablecoin yield products available in 2026:

  • Simple
  • Liquid
  • Non-custodial
  • Low risk by DeFi standards
  • Backed by one of the most established protocols in the space

If you already hold GHO or plan to mint it, sGHO is the default place to put idle capital.

FAQ

1. What is Savings GHO (sGHO)?

Savings GHO (sGHO) is a yield-bearing token that represents deposited GHO on Aave. When users deposit GHO, they receive sGHO, which automatically accrues yield over time and can be redeemed at any moment for GHO plus earned rewards.

2. How does sGHO earn yield?

sGHO earns yield from Aave protocol revenue sources, primarily GHO borrowing fees and governance-approved reward allocations distributed through Aave’s Merit program. The yield is variable and adjusts based on market demand and DAO decisions.

3. Is sGHO safe compared to other DeFi yield products?

sGHO is considered low risk relative to most DeFi yield options because deposited GHO is not rehypothecated, there is no slashing mechanism, and withdrawals are instant. The main risks are smart contract risk and potential temporary GHO peg deviations during extreme market conditions.

4. Can I withdraw my funds from sGHO at any time?

Yes. sGHO has no lockups or cooldowns. Users can redeem sGHO instantly to receive their original GHO plus all accrued rewards at any time.

5. What is the difference between sGHO and staking GHO (stkGHO)?

sGHO replaced the older stkGHO model for passive holders. Unlike stkGHO, sGHO has no cooldown period, no slashing risk, and is designed purely as a savings product rather than a protocol backstop or insurance mechanism.

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