[Direct to AIP] Aave V3 Mantle – Collateral Enablement, eMode Expansion, and Isolation Updates (USDT0, USDe, ETH, XAUT)
Author: ACI
Date: 2026-02-24
Summary
This AIP proposes to implement the following configuration updates on Aave V3 Mantle Instance:
- Enable USDT0 as collateral
- Update eMode Category 2 to:
- Enable USDT0 as collateral
- Enable USDe as borrowable asset
- Remove ETH from Isolation Mode
- Add XAUT as standard (non-isolated) collateral
- Create a dedicated XAUT-Stable eMode category with:
- XAUT as collateral
- USDT0, USDC, and GHO as borrowable assets
This proposal is submitted as a Direct-to-AIP since all referenced assets are either already onboarded on Aave V3 Mantle Instance or other instances.
Motivation
These updates aim to improve capital efficiency, stablecoin peg arbitrage functionality, and market-making capabilities on Mantle.
Enabling USDT0 as collateral and expanding eMode Category 2 to include USDT0 bas collateral and USDe as debt enhances:
- Stablecoin-to-stablecoin arbitrage
- Market-making depth
- Borrow utilization and protocol revenue
Subject to Risk validation:
- Removing ETH from Isolation Mode increases composability and borrowing flexibility.
- Adding XAUT as standard collateral diversifies collateral types with a gold-backed asset.
- Creating a dedicated XAUT-Stable eMode improves capital efficiency for gold-backed liquidity strategies while containing risk within a clearly segmented category.
These changes align with Aave’s objective of improving risk segmentation, capital efficiency, and revenue generation across deployments while remaining fully subject to Risk Service Provider approval.
Specification
Risk Parameters will be provided by Risk Service Providers and proposal will be updated accordingly at ARFC stage.
Disclaimer
ACI is not presenting this proposal on behalf of any third party and is not compensated for creating this proposal.
Next Steps
- Publish proposal to gather community and Service Providers feedback.
- Publish an AIP vote for final confirmation and enforcement of the proposal.
Copyright
Copyright and related rights waived under CC0