LlamaRisk proposes doubled PT-USDG cap and revised Aave V3 rates

LlamaRisk published a new set of Aave V3 reserve parameter recommendations on September 4, covering a higher supply cap for PT-USDG-29OCT2026, a higher base variable borrow rate for USDe, and lower variableRateSlope1 settings for USD₮0 and USDG on X Layer. The full filing is on the Aave Governance Forum.

LlamaRisk is a DeFi risk service provider funded in part by the Aave DAO. The stated basis for the recommendations is user behavior, on-chain liquidity and position health.

The largest cap change

LlamaRisk recommends increasing the supply cap for PT-USDG-29OCT2026 on Aave V3 X Layer from 35,000,000 to 70,000,000. That doubles the cap, a 100% increase.

The reserve currently holds 28,475,365 PT-USDG-29OCT2026 against the existing 35,000,000 cap, putting utilization at 81.4%, per LlamaRisk. Against the proposed cap, that same outstanding supply would represent 40.7% utilization — calculated as 28,475,365 divided by 70,000,000. (The 40.7% utilization figure, the 41,524,635 units of cap room, and the cap comparison are the desk’s calculations from figures attributed to LlamaRisk.)

The primary trading venue is the Pendle AMM pool on X Layer, which LlamaRisk reports at $4.68 million in total liquidity, composed of 88% SY and 12% PT.

The PT trades at a 0.48% discount to par, with an implied yield of 3.28% and 55 days to maturity, per LlamaRisk. USDG’s secondary-market liquidity on X Layer adds approximately $17.3 million across decentralized-exchange pools, with the deepest USDG/USD₮0 pair holding $5.1 million, per LlamaRisk.

Borrowing rates move in both directions

For USDe, LlamaRisk recommends raising the baseVariableBorrowRate from 3.00% to 4.00% across Aave V3 Core, Plasma, Monad, Mantle and Avalanche — a 100-basis-point increase. The filing ties this to a stablecoin interest-rate program proposed by TokenLogic, pricing USDe borrowing in line with Ethena’s native staking rate. If adopted, it would raise the base component for USDe variable borrowing across those five V3 instances.

X Layer moves in the other direction on slope settings. LlamaRisk recommends cutting variableRateSlope1 for USD₮0 from 5.00% to 4.50% — 50 basis points — and applying the same reduction to USDG. The filing says these cuts align USD₮0 and USDG reserves with yield-bearing collateral strategies.

The rate changes are not uniform: variable-rate borrowers of USDe will face higher borrowing costs from the 100-basis-point base rate increase, while variable-rate borrowers of USD₮0 and USDG on X Layer may see lower borrowing costs from the 50-basis-point Slope1 reduction. (The basis-point figures are the desk’s calculations from figures attributed to LlamaRisk.) The Aave Governance Forum filing at S1 is the primary source for all parameter figures cited in this article.