Aave stewards propose targeted cap and rate changes

LlamaRisk has proposed a set of targeted risk-parameter changes for Aave V3, including higher stablecoin borrowing limits, lower exposure to WETH.e, and a higher variable borrowing rate for USDe. The recommendations are based on user behavior, on-chain liquidity and position health observed in its latest reserve review, according to the Aave Governance proposal for V3, published November 6, 2026.

The filing covers several deployments rather than a single protocol-wide adjustment. On Aave V3 Avalanche, LlamaRisk recommends lifting the USDt borrow cap from 22.8 million to 30 million and the USDC$0.9995▲0.00% borrow cap from 64.6 million to 70 million. At the current amounts listed in the proposal, those caps are 76.0% and 92.3% utilized respectively, calculated as 22.8 million divided by 30 million and 64.6 million divided by 70 million.

The same Avalanche recommendation cuts the WETH.e borrow cap from 13,500 to 7,000. LlamaRisk also proposes raising the WETH borrow cap on Aave V3 Prime from 17,000 to 19,000, while reducing the wstETH supply cap there from 80,000 to 55,000.

That mix matters for positions at the cap. Borrowers using USDt or USDC$0.9995▲0.00% on Avalanche would receive more room under the proposed limits, while WETH.e borrowers would face a lower ceiling. Suppliers of wstETH on Prime would face a smaller permitted supply total if the recommendation is implemented.

LlamaRisk’s larger-cap recommendations extend to other V3 markets. On X Layer, it proposes raising the USD₮0 supply cap from 100 million to 150 million and the borrow cap from 70 million to 135 million. On Aave V3 Core, the recommended USDC$0.9995▲0.00% supply cap rises from 3 billion to 3.5 billion, while its borrow cap increases from 2.27 billion to 2.6 billion.

The rate change moves in the opposite direction for USDe. LlamaRisk recommends setting the base variable borrow rate to 7.00% on Aave V3 Core, Monad, X Layer, Mantle, Plasma and Avalanche. That would change the borrowing-rate input across six V3 instances, alongside the cap adjustments.

V4 is included in a separate Aave Governance filing. LlamaRisk says its V4 recommendations also rely on observed user behavior, on-chain liquidity and position health.

On Aave V4 Ethereum, the proposed USDG draw cap on the Core Hub Main Spoke rises from 63.5 million to 75 million. LlamaRisk’s figures imply 71.0% utilization after the change. The recommendation also raises the WBTC add cap on the Prime Hub Bluechip Spoke from 700 to 1,000; the proposal’s current utilization works out to 37.5%, using 375 units against the proposed 1,000-unit cap.

The Ethereum V4 filing also proposes raising the USDe base rate on the Plus Hub from 6.60% to 7.00%. On V4 Avalanche, the USDC draw cap on the Core Hub Main Spoke would increase from 9 million to 15 million. On V4 Base, the GOOGLc add cap on the Equities Hub MAG7 Spoke would rise from 22,000 to 40,000.

The proposed changes will be implemented through the Risk Steward process. The governance records frame the package as a response to measured reserve conditions and user activity. No exploit or critical vulnerability is identified in the supplied recommendations, so the desk’s read is that this is a proactive adjustment to limits and rates rather than an emergency response to an incident. The fact sheet provides no prior incident record for a direct comparison with earlier rapid changes.