Aave Labs, the firm behind $55 billion DeFi lending protocol Aave, is set to launch a new retail-facing savings app designed to compete with banks and rival fintech firms.The new product, called Aave App, will offer yields of up to 9%, and $1 million worth of protection against security breaches and technology failures for deposits, according to a Monday announcement from the firm. The app’s target audience? Digital natives who are fed up with the low interest rates offered by traditional banks. “Banks built online access and mobile apps, but your money still sits there barely keeping up with inflation while they use it to earn far more than they pay you,” Aave Labs said in the announcement. “Your savings shrink, even if the number in your account slowly ticks up.”Aave is a decentralised lending protocol that matches lenders and borrowers of different crypto assets, such as Ethereum’s Ether token and stablecoins like Circle’s USDC. Interest rates on the platform are set by market demand, with Aave taking a small cut of the interest paid to lenders. The move is the latest example of crypto firms looking to leverage the high yields found in decentralised finance to win over customers from the traditional banking system. Bridging the gapThe $166 billion DeFi ecosystem has long offered lucrative opportunities to earn more interest than even the highest-yielding savings accounts offered by traditional banks.However, using DeFi is fraught with risks, as its self-custodial setup comes at the cost of fewer guardrails for users. Aave App, which will launch on the Apple store, is an attempt to bridge the gap between DeFi and retail customers. This idea of abstracting away the complexities of DeFi behind an easy-to-use interface is sometimes referred to as the DeFi mullet. It’s not the only crypto firm doing so.Morpho Labs, the firm behind Rival lending protocol Morpho, inked a deal with US crypto exchange Coinbase earlier this year to let users borrow against their Bitcoin deposits using the Morpho protocol. The feature has proven popular, with Morpho-originated loans on the exchange surpassing $1 billion in September.Neobank trendAave’s plan to offer high-yield savings accounts also comes as crypto neobanks soar in popularity. More than half a dozen of this new breed of financial app have launched over the past year, banking on clearer regulations and the technological savvy of younger generations to fuel their success.But competition is fierce. New entrants such as Aave will also have to go toe-to-toe with neobanking titans like Chime, Revolut and Monzo, who are meeting these crypto neobanks halfway by building out their own blockchain features. For its part, Aave App will offer many features that are popular with its competitors. In addition to offering higher yields than traditional banks, the app will feature tools to simulate potential investment returns, rewards for recurring deposits, and support for bank, debit card, and stablecoin deposits.Users can currently join a waitlist for the app’s iOS version.Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at [email protected].Aave Labs, the firm behind $55 billion DeFi lending protocol Aave, is set to launch a new retail-facing savings app designed to compete with banks and rival fintech firms.The new product, called Aave App, will offer yields of up to 9%, and $1 million worth of protection against security breaches and technology failures for deposits, according to a Monday announcement from the firm. The app’s target audience? Digital natives who are fed up with the low interest rates offered by traditional banks. “Banks built online access and mobile apps, but your money still sits there barely keeping up with inflation while they use it to earn far more than they pay you,” Aave Labs said in the announcement. “Your savings shrink, even if the number in your account slowly ticks up.”Aave is a decentralised lending protocol that matches lenders and borrowers of different crypto assets, such as Ethereum’s Ether token and stablecoins like Circle’s USDC. Interest rates on the platform are set by market demand, with Aave taking a small cut of the interest paid to lenders. The move is the latest example of crypto firms looking to leverage the high yields found in decentralised finance to win over customers from the traditional banking system. Bridging the gapThe $166 billion DeFi ecosystem has long offered lucrative opportunities to earn more interest than even the highest-yielding savings accounts offered by traditional banks.However, using DeFi is fraught with risks, as its self-custodial setup comes at the cost of fewer guardrails for users. Aave App, which will launch on the Apple store, is an attempt to bridge the gap between DeFi and retail customers. This idea of abstracting away the complexities of DeFi behind an easy-to-use interface is sometimes referred to as the DeFi mullet. It’s not the only crypto firm doing so.Morpho Labs, the firm behind Rival lending protocol Morpho, inked a deal with US crypto exchange Coinbase earlier this year to let users borrow against their Bitcoin deposits using the Morpho protocol. The feature has proven popular, with Morpho-originated loans on the exchange surpassing $1 billion in September.Neobank trendAave’s plan to offer high-yield savings accounts also comes as crypto neobanks soar in popularity. More than half a dozen of this new breed of financial app have launched over the past year, banking on clearer regulations and the technological savvy of younger generations to fuel their success.But competition is fierce. New entrants such as Aave will also have to go toe-to-toe with neobanking titans like Chime, Revolut and Monzo, who are meeting these crypto neobanks halfway by building out their own blockchain features. For its part, Aave App will offer many features that are popular with its competitors. In addition to offering higher yields than traditional banks, the app will feature tools to simulate potential investment returns, rewards for recurring deposits, and support for bank, debit card, and stablecoin deposits.Users can currently join a waitlist for the app’s iOS version.Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at [email protected].