[Direct to AIP] Add WETH to the wrsETH wstETH E-Mode on Aave V3 Base Instance
Author: @ACI
Date: 2025-11-18
Summary
This proposal seeks to extend utility for wrsETH on the Aave V3 Base market by adding WETH borrowing to the existing wrsETH/wstETH E-Mode category.
Motivation
rsETH—issued by Kelp DAO—is already integrated across various Aave deployments and has exhibited a stable risk and liquidity profile. On Base, wrsETH suppliers currently rely primarily on stablecoin borrowing and the existing wstETH E-Mode, which limits the efficiency of yield-maximizing leveraged positions.
By adding WETH as a borrowable asset in the wrsETH/wstETH E-Mode, Aave unlocks traditional wrsETH–WETH looping strategies.
Given strong sidelined demand and Kelp’s growing LRT ecosystem, we expect significant additional rsETH inflows to Base, enabling the market to absorb excess WETH supply while restoring balanced utilization levels.
Specification
| Parameter | wrsETH | WETH | wstETH |
|---|---|---|---|
| Collateral | Yes | No | No |
| Borrowable | No | Yes | Yes |
| Max LTV | 93% | - | - |
| LT | 95% | - | - |
| LB | 1.0% | - | - |
This is the initial specification proposed.
Proposal to be updated with Risk Parameters by Risk Service Providers following their review.
Useful Links
- [ARFC] Add rsETH to Aave V3 Ethereum
- [Direct to AIP] Onboard rsETH to Aave V3 Avalanche Instance
- rsETH Documentation: https://docs.kelpdao.xyz/
Disclaimer
This proposal is powered by Skywards. The Aave Chan Initiative is not directly affiliated with Kelp DAO and did not receive compensation for the creation of this proposal.
Next Steps
- Publication of this Direct-to-AIP proposal for community and service-provider feedback.
- Submission of an on-chain AIP vote for final confirmation and execution.
Copyright
Copyright and related rights waived via CC0.