Aave proposes higher JAAA LTV and LT and lower caps for six assets

Two Risk Stewards filings landed October 15, 2026, and they pull in opposite directions. The JAAA parameter proposal would push reserve-tier LTV from 81% to 87% and the liquidation threshold from 86% to 89%, leaving the 5% liquidation bonus untouched. The cap-reduction filing does the opposite: trimming supply caps for USDe, sUSDe, and sAVAX while cutting borrow caps on LINK, WAVAX, and WBNB.

Neither proposal is yet in effect, and the filings disclose no implementation date or vote deadline.

The LTV change is the one reserve-tier JAAA borrowers will actually feel. At 81%, a hundred dollars of collateral covers up to $81 of debt before other account constraints kick in. At 87%, same collateral, same borrower, that ceiling becomes $87. Using the filing’s inputs, maximum theoretical leverage stands at 5.26x under the current LTV — calculated as 1 / (1 – LTV) — and 7.69x under the proposed level. That’s a 46.2% jump in the leverage multiple: (7.69 – 5.26) / 5.26.

Then there’s the liquidation threshold. Using the proposed LT and liquidation bonus, the gap before collateral value adjusted for the bonus would stop covering the debt is 6.55%: 1 – 0.89 × 1.05. Stack the 87% LTV against that 89% LT and the gap between borrowing and liquidation eligibility narrows to 2.25%: 1 – 0.87 / 0.89. Under the proposed parameters, debt would sit closer to the liquidation line while liquidators are still working the same 5% liquidation bonus when they actually step in.

These reserve-tier settings would still come in below the existing JAAA GHO E-Mode parameters — 88% LTV, 90% LT, 5% bonus — so reserve borrowers gain capacity without crossing that separate configuration.

The justification is a year of redemption history. JAAA is the tokenized share class of the Janus Henderson Anemoy AAA CLO Fund, issued through Centrifuge, holding AAA-rated tranches of collateralized loan obligations with a NAV feed published on-chain by Chainlink. Between October 10, 2025, and October 5, 2026, the fund processed 93 redemption orders totaling $717.3 million. Ninety-one settled on the request date or the following business day. Two settled at T+2, including the single largest redemption: $326.9 million on March 9, 2026. The filing explicitly ties the looser parameters to that record.

The original December 2025 evaluation that set the 81% LTV and 86% LT described redemptions as serviceable within T+3, with room for longer processing. This update holds the bonus constant and points to a tighter realized settlement record as the argument for moving the other two figures.

Exposure is concentrated in a handful of positions. Horizon currently holds $51.9 million of JAAA at a NAV of 1.0522. Three positions account for 9,772,596 JAAA — 19.8% of supply — through the JAAA GHO E-Mode. The remaining 39.5 million JAAA, 80.2% of supply, sits in the reserve tier, where seven positions carry $45.0 million of debt: $34.5 million in RLUSD and $10.5 million in GHO. Those seven are the ones that gain most from a higher LTV and LT, able to run more debt against their collateral before hitting liquidation eligibility.

The JAAA parameter proposal adjusts LTV and LT for the reserve tier; the cap-reduction filing is a separate proposal addressing supply and borrow limits for six assets across Core, Avalanche, and BNB Chain. USDe’s Aave V3 Core supply cap would fall from 550 million to 400 million — a 27.3% cut. Current supply sits at 261.4 million, which leaves 138.6 million of room under the proposed ceiling. Supply was running around 785.2 million in August, a 66.7% decline to where it stands now.

sUSDe’s Core supply cap would drop from 175 million to 130 million, down 25.7%. Current supply is 104.6 million, so 25.4 million separates it from the new ceiling. Supply there fell from roughly 366.5 million in August — a 71.5% contraction.

On Avalanche, sAVAX would see its supply cap cut from 10 million to 7 million. Deposits are currently at 6.73 million, 67.3% of the existing cap, which means passing the new ceiling would only require another 270,000 units. Today that buffer is 3.27 million.

Borrow caps tighten across three assets. LINK would halve from 1 million to 500,000, leaving 185,000 LINK of room against current debt of 315,000. WAVAX would fall from 11.7 million to 6 million — a 48.7% reduction — with 360,000 WAVAX of headroom against current debt of 5.64 million. WBNB faces the deepest cut: from 15,600 to 4,000, a 74.4% reduction, leaving 1,410 WBNB of borrowing room against current debt of 2,590.

The filings describe the reductions as aligning ceilings with current demand and liquidity conditions. Background on related Aave parameter adjustments is in CryptoScoop’s earlier report.