Greetings, Aave community!
Aave Labs has continued to make steady progress on multiple protocol endeavors in line with its service provider scope.
The below summary highlights developments in the Aave Protocol and reflects Aave Labs’ transparent and collaborative approach of building in public, welcoming community feedback, and fostering auditability through open-source principles.
April update:
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Supported the DAO response to the rsETH incident, coordinating with risk, security, and ecosystem contributors.
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Launched and supported security-driven growth of Aave V4 on Ethereum mainnet, with guarded caps and early production validation.
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Continued Aave V3 maintenance and governance proposals coordination, including Scroll deprecation, new asset onboarding.
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Supported GHO through the sGHO architecture upgrade, Plasma growth, and DAO treasury deployment.
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Led Aave Horizon growth, including prospective integrations, and DAO collector fee routing after AWW passed.
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Progressed the SDK and Aave Pro with new releases, reserve data surfaces, rewards readiness, and developer migration clarity.
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Continued Aave Interface and CoW adapter work, including Scroll UI updates, CoW swaps reactivation, and DAO collector fee routing after AWW passed.
rsETH Incident
The rsETH incident was the most significant protocol-related event of the month, requiring coordination across the Aave DAO contributor ecosystem. Assets affected by the incident were used as collateral on Aave V3 Ethereum and Arbitrum to borrow a substantial amount of wETH, while also interrupting Aave V4’s early growth trajectory shortly after activation.
Aave Labs has been working closely with @LlamaRisk, @TokenLogic, @Certora, @Chainlink_Labs and other relevant ecosystem participants to support the assessment and resolution process. The priority remains to minimize impact to the Aave ecosystem, preserve protocol safety, and help the DAO evaluate the appropriate next steps.
For further updates on the efforts to restore normal protocol operations, please refer to Aave’s official communication channels, including x.com/aave, and the governance forum at governance.aave.com.
Aave Core Protocol
Aave V4
Aave V4 was activated on Ethereum mainnet on March 30 following approval of the Aave V4 Activation proposal, marking a major milestone for the Aave Protocol and the broader Aave ecosystem. The deployment introduced the first production instance of Aave V4’s Hub-and-Spoke architecture, bringing the protocol’s next generation design live while maintaining a security-first, guarded launch approach.
Initial growth was strong despite deliberately conservative caps and the absence of incentives or points programs. During the first week, Aave V4 reached nearly $10M in deposits, and by April 13 deposits had surpassed $20M. The early usage demonstrated meaningful demand for the new architecture, while the guarded cap structure gave the DAO and service providers space to monitor behavior, validate system performance, and assess market conditions before expanding capacity.
As reserves filled quickly, cap increases were progressed through governance to support continued adoption. @LlamaRisk recommended approximately $28M in additional deposit capacity across the Core, Prime, and Plus Hubs, and a second round of cap increases was proposed by April 14. This process reflects the intended launch cadence for Aave V4: support security-driven protocol growth by expanding available capacity incrementally as real usage data accumulates and contributors gain additional confidence in market behavior.
In parallel, Aave Labs progressed an internal monitoring and security tooling initiative for Aave V4, in collaboration with @Certora. The work is designed to provide greater visibility into key protocol features, helping validate invariants, confirm proper configuration, and strengthen ongoing production monitoring as the system scales.
Aave V3
Aave V3 work throughout April included a combination of market lifecycle management, governance execution, and continued support for new asset and network configurations.
On Scroll, the Aave V3 instance was formally moved toward deprecation following the reduction in market activity and EtherFi’s migration to Optimism. As part of the wind-down process, all supply and borrow caps were reduced to zero and reserves were frozen, with AIP #470 going live on April 13 to formally deprecate the instance. This reflects the ongoing effort to keep Aave deployments aligned with actual usage, liquidity conditions, and operational priorities, with continued analysis and coordination from risk providers.
Starting in April, Aave Labs assumed the leading role and expanded its responsibilities in Aave V3 governance execution, progressing multiple proposals directly while continuing to review and support proposals from other contributors. This included the onboarding of PT-USDG-28MAY2026 to Aave V3 Core as E-Mode-only collateral, the onboarding of wETH to the Aave V3 Celo instance, and parameter updates across several markets. In parallel, collateral parameter adjustments were advanced for the MegaETH instance across wETH, BTC.b, and wstETH, while the onboarding of USDe and sUSDe to Aave V3 on MegaETH continued to progress.
GHO
Early in the month, @TokenLogic announced an architecture upgrade for sGHO, moving the product toward an ERC-4626 vault design with a fixed 4.25% APR, one-click entry from USDC, and a dedicated rate governance contract. This architecture is intended to make sGHO easier to integrate across DeFi and CeFi venues, while continuing to strengthen GHO’s role as the Aave Protocol’s native stablecoin and a core component of the broader Aave ecosystem.
GHO also saw strong growth on Plasma, becoming the fastest GHO deployment on a sidechain to date. By April 13, GHO on Plasma had reached its $50M supply cap, prompting an immediate request to risk stewards to assess further capacity increases. A follow-up request also progressed to raise the GHO borrow cap on Plasma to $35M, reflecting continued demand for GHO liquidity on the network.
In parallel, the team successfully claimed 5M GHO from the DAO treasury. The funds were subsequently deployed on Aave V3, where they are earning yield at approximately 2%, supporting productive treasury management while keeping the assets within the Aave ecosystem.
Aave Horizon
Following the passing of Aave Will Win proposal, Horizon treasury routing was updated during the month so that Horizon fees accrue to a DAO-owned collector address. This update does not introduce a new fee source or modify the underlying economics of Horizon. It routes the existing fee flow into DAO collector infrastructure, in line with the proposal, under which all applicable fees are routed to the DAO.
Aave Software Development Kit (SDK)
Work throughout April progressed through a steady cadence of releases focused on expanding protocol coverage, improving data availability, and strengthening reliability for integrators. The team added a new query to support the new reserve pages, including top address holder data. Subsequent updates added support for new spoke liquidation configuration, resolved stale claimable rewards behavior, and introduced reserve count asset summaries, improving the Aave Software Development Kit’s ability to surface protocol state across new Aave V4 components and user-facing product surfaces.
A key strategic direction was also clarified during the month: aave-utilities is in maintenance mode and will not receive further updates. Going forward, the developer path will be the new Aave V4 SDK packages, including aave/client and aave/react, providing a clearer and more consistent integration surface for developers building on top of the Aave Protocol.
Aave Pro
Aave Pro reached its production v1.0 release on March 30, with pro.aave.com going live alongside the Aave V4 launch. After several months of testnet iteration, feedback gathering, and interface refinement, the release brought the full Aave V4 Protocol experience to mainnet through a dedicated interface designed for the new Hub-and-Spoke architecture and more advanced user flows.
Following launch, the team shipped a series of targeted fixes to improve production reliability and user experience. These updates addressed Safe wallet deposit transaction issues, missing network fee displays, missing back-button behavior across pages, WalletConnect configuration adjustments, numerous mobile and design changes to improve UX, and alignment of the swap warning modal with the latest design specifications.
In parallel, Aave Pro continued to expand its feature set. New reserve pages were released with interest rate data, supply and borrow caps, and top depositor address information. Rewards were also fully integrated and are ready to activate once production campaigns go live. Across the product, the team continued extensive mobile and desktop UI/UX polish, further improving the experience for power users interacting with Aave V4.
Aave Interface
Aave Interface work throughout April focused on reflecting governance changes across markets, maintaining production reliability, and delivering incremental UX improvements in support of current growth initiatives.
Following the risk steward cap reductions on April 10 and the subsequent progression of AIP #470, the Interface was updated to reflect the formal deprecation path for the Aave V3 Scroll instance. The affected reserves, including wETH, USDC, wstETH, and weETH, were shown as frozen, while reserve factor changes were reflected to support the intended unwinding process.
In parallel, the team continued delivering bug fixes, incremental feature improvements, and UX refinements across the Interface. These updates supported ongoing market operations while helping ensure users had clearer information when interacting with markets undergoing parameter changes or lifecycle transitions.
CoW Adapters
CoW adapter work during April focused on restoring swap availability while maintaining a cautious rollout posture following the CoW interface incident. After the incident was remediated, CoW swaps were re-enabled in mid-April across both app.aave.com and pro.aave.com, restoring swap functionality across the main Aave product surfaces.
Following the passing of Aave Will Win proposal, Aave’s share of CoW partner fees was routed to the relevant DAO Collector address, bringing CoW partner fee revenue under direct DAO collector settlement. This update does not introduce a new fee source or modify the underlying CoW arrangement; it records the routing of Aave related swap fee flows into DAO-owned infrastructure, strengthening the DAO’s capture of revenue generated through Aave product integrations.
What’s coming next?
Our main focus for the coming month will be
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Continuing rsETH mitigation efforts and supporting the DAO response process.
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Resuming security-driven growth activities for Aave V4 as conditions allow.
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Advancing Aave V3 governance execution, including proposal coordination, parameter updates, and contributor proposal reviews.
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Progressing GHO growth workstreams support, including Plasma capacity increases and continued sGHO integration support.
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Improving Aave Pro onboarding and usability, including a better new user experience and new market pages with activity and parameter details.
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Continuing SDK and Interface improvements, with focus on developer migration, reserve data, and market lifecycle support.
Stay tuned for next month’s update.
Aave Labs