[ARFC] Freeze TUSD on Aave V2 Ethereum Pool

Title: [ARFC] Freeze TUSD on Aave V2 Ethereum Pool
Author: @MarcZeller - Aave Chan Initiative
Date: 2023-06-27


This ARFC proposes a direct-to-AIP framework proposal to freeze TUSD on the Aave V2 Ethereum pool.


Following recent events with the TUSD asset, The ACI proposes to freeze the TUSD reserve on the Aave V2 Ethereum pool. This will prevent users from depositing or borrowing TUSD on the Aave V2 Ethereum pool. This will not affect current positions. Users will still be able to repay and withdraw TUSD from the Aave V2 Ethereum pool.

This AIP is designed to take a conservative approach to the TUSD situation. It will allow the community to take a step back and assess the situation before making any further decisions.


The proposed change will require modifications to the Aave protocol smart contracts. Specifically, the FreezeReserve() function will be called on the TUSD reserve in the Aave V2 Ethereum pool. This will prevent any new deposits, borrows for TUSD on the pool, effectively freezing the reserve.

in terms of implementation, here’s the proposed payload:

contract AaveV2FreezeReserves_20230627 is IProposalGenericExecutor {
  address public constant TUSD = AaveV2EthereumAssets.TUSD_UNDERLYING;

  function execute() external {


The ACI has not been compensated to present this proposal.

Next Steps

  1. Escalate this proposal to AIP stage.
  2. If AIP outcome is YAE, the proposed changes will be implemented on the Aave protocol.


Copyright and related rights waived via CC0.


Thanks ACI for putting up this proposal. As Gauntlet mentioned here, out of an abundance of caution and for proactivity, we support ACI’s proposal to freeze TUSD supply.

1 Like

Thanks for the proposal, we support the freezing of TUSD.

Thanks for putting this forward @MarcZeller. Chaos Labs supports this proposal to implement a freeze to limit the protocol exposure to TUSD.

Supporting freezing at least until the perceived counterparty risk decreases.
It is actually important for the community to normalize the freezing action as something fully reversible, but at the same a really important risk-control mechanism that should be exercised proactively.

Additionally, just the fact of considering freezing on an asset should mean that the LT/LTV parameters (80%/82.5%) are completely over-configured, so, in my opinion, they should be radically dropped, most probably close to 70% LT levels.
TUSD is a liquid asset, so even if potentially causes liquidations, it should be possible for users to use the collateral swap feature to replace their exposure.

Fully agree here with @eboado
Freezing should be an action with some standard mechanism, that should be executable fast.

  • dropping LTV (hard)
  • adding a note to the Interface
  • maybe even add a note to suggest using the collateral swap feature

Just make it visible.

Please kindly explain the escalation of the poll bypassing snapshot? Is this governance procedure? So the previous poll to drop the LT and LTV was ignored?

ACI are you truly independent and not working for kickbacks with an agenda? To achieve an outcome you desire?

Again this is abuse of governance and centralised i now strongly doubt the integrity of ACI and marc zeller now.

The community should assess the actions on how much exceptions has been granted to this poll to attempt to skew the votes towards hes desired outcome.

This is ridiculous and if it can happen now it can happen again and again.


Here’s the framework [ARFC] Aave V3 Caps update Framework

here’s the snapshot that integrated it on guidelines Snapshot


As I always say, all opinions are welcomed in this forum, but not all ways to express them are. @fumoffuXx consider yourself warned. here are the Forum Guidelines; FAQ/Guidelines

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It is unfortunate for you to provide a warning on topics you do not see eye to eye with. My comments did not offend the guidelines as what you considered name calling.

It is clear that corners are cut when the position of the risk assessors had suddenly changed away from the forums for public view. No reason were provide just a sudden change of heart.

I do not see myself at fault for insinuating your lack of integrity on the matter. It is clear there was some form of communications and cohesion to collude on the matter.

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You might not be familiar with the forum, but text in blue is actualy clickable and lead you to moar text.

Here you might see that both gauntlet and chaos lab provide explanation on their position: (click on the blue text)

Gauntlet: https://governance.aave.com/t/arfc-gauntlet-recommendation-on-tusd-for-aave-v2-ethereum/13727

Chaos: https://governance.aave.com/t/arfc-gauntlet-recommendation-on-tusd-for-aave-v2-ethereum/13727/4

Also one point you might not know is that risk manager point of view is only consultative and the DAO can perfectly ignore it if it wishes to.
Futhermoar, as that their analysis rely mainly on on-chain data the extend of their recommendation has some limit.

But glad to see u are taking dao participation seriously ^^


We agree with decreasing LT/LTV. We have an AIP up here and the corresponding forum post is here.

1 Like

We support the freeze of TUSD.