AL Development Update | March 2026

Greetings, Aave community!

March’s update takes a different form. Rather than follow the usual monthly structure, this post focuses exclusively on the Aave V4 and Aave Pro launches and what they represent for the next phase of Aave.

Aave V4

Following the successful governance approval process through the AIP, Aave V4 is now active on Ethereum. This marks a major milestone for Aave and a meaningful one for DeFi more broadly. V4 is a new stage in the protocol’s evolution, with a new protocol architecture designed to expand the range of markets Aave can support while preserving the security, efficiency, and discipline that have defined the protocol to date.

The launch of Aave V4 also concludes a long development cycle built around a security-first process. Across the full program, V4 underwent roughly 345 days of cumulative security review spanning manual audits, formal verification, invariant testing, fuzzing, and a public security contest, backed by a $1.5 million DAO-ratified security budget. That foundation matters because V4 enters production with a level of preparation intended to match the importance of the release.

At the protocol level, Aave V4 introduces the Hub and Spoke architecture. Liquidity is unified at the Hub layer, while Spokes define distinct borrowing environments, controls, and risk boundaries. This allows governance to introduce new markets and features without migrating liquidity, while preserving capital efficiency and enabling stronger separation between different risk profiles.

V4 also introduces mechanisms that materially expand the protocol’s design space. Risk Premiums allow borrowing costs to reflect collateral quality rather than applying uniform rates across all users, while the new liquidation engine replaces the fixed close factor approach with a target health factor model and variable liquidation bonuses. In practice, that means more precise risk pricing, fairer liquidations, and a framework that can support a broader range of collateral and market structures with stronger economic alignment.

Equally important is the rollout philosophy. The initial Ethereum activation has been intentionally conservative. During the first weeks, caps will remain low while the protocol hardens in production and the DAO gathers operating data across liquidity routing, utilization, and credit-line behavior. Growth is expected to follow stability, with parameter expansion occurring as the system matures and governance grows comfortable increasing exposure.

Aave Pro

Aave Pro is now live as the dedicated interface for the Aave V4 era. Rather than fit V4 into legacy interaction patterns, Aave Pro gives the new architecture its own purpose-built surface at pro.aave.com and establishes a dedicated home for DeFi-native users who want deeper visibility and more control. It is the product layer designed to match the protocol’s new structure.

The launch of Aave Pro is also the result of several months of work across frontend, API, SDK, and documentation layers. Recent development updates tracked the progression from core flow implementation and testing, to documentation and SDK alignment, to UI and UX refinement, and broader integrator readiness. Bringing Aave Pro live now means Aave V4 enters the market with a dedicated interface built for how the new system is meant to be used.

Looking Ahead

Taken together, these launches represent more than the release of a new version and a new interface. They establish the next protocol architecture for Aave and the product surface built to expose it properly to users and integrators. The immediate priority now is disciplined execution in production: monitoring live behavior, validating early assumptions, iterating on UX and documentation, and expanding carefully in coordination with risk providers and the DAO.

We invite the community to use Aave V4 and Aave Pro, and to review the supporting materials now available across the Aave V4 documentation, technical documentation, core contracts repository, and Aave V4 SDK. Those resources will remain important reference points as usage grows, integrations deepen, and the system moves through its first phase in production.

Stay tuned for next month’s update.

Aave Labs

3 Likes

Congratulations to the Aave Labs team on the Aave V4 mainnet launch this marks a significant milestone not just for Aave, but for DeFi architecture as a whole.

A few observations from a governance perspective:

On the Hub & Spoke model: This is arguably the most important structural shift in Aave’s history. The ability to isolate risk at the Spoke level while keeping liquidity unified at the Hub is a governance unlock too it means future markets (RWAs, new collateral types) can be onboarded with ring-fenced risk, reducing the “one bad asset poisons the pool” problem. The DAO should proactively define Spoke governance criteria before expansion begins, rather than reactively setting rules after incidents.

On the new Liquidation Engine: Moving away from fixed close factors to a target health factor model is overdue. However, the DAO needs clear guidelines on how variable liquidation bonuses will be governed who proposes adjustments, what thresholds trigger review, and how this interacts with risk providers’ mandates.

On the conservative launch approach: 345 days of security review and a $1.5M DAO budget investment is commendable. This sets a new standard for protocol upgrades in DeFi.

Looking forward to tracking V4’s expansion through governance. Would appreciate a future update on how risk parameters for Hub liquidity will be governed as Spokes multiply. @AaveLabs