Summary
LlamaRisk recommends an initial containment step for the Aave V3 Aptos deployment via supply and borrow cap reductions. The market has seen limited adoption since launch, with a total market size of $7.57M and only $878.96K in outstanding borrows against $126.5M in aggregate supply caps. Following discussions with the Aave SPs, we propose tightening supply caps to ~1.25x of current supply cap utilization and reducing borrow caps to levels more closely aligned with current outstanding borrows across all borrowable assets. This prevents significant new exposure from being created while leaving existing positions fully functional, with the possibility to add collateral and increase position health factor.
Motivation
The Aave V3 Aptos deployment currently operates at minimal scale relative to its configured capacity:
- Total market size of $7.57M represents a fraction of the protocol’s other deployments.
- Outstanding borrows total $878.96K, with utilization rates below 2% for stablecoins and 24% for APT.
- Supply cap utilization ranges from 0.01% (sUSDe) to 71% (APT), with stablecoins at 6-9%.
| Asset | Total Supplied | Supply Cap | Cap Util. | Total Borrowed | Borrow Cap | RF |
|---|---|---|---|---|---|---|
| USDT | 3.53M | 60,000,000 | 5.9% | 700.67K | 45,000,000 | 10% |
| APT | 710.00K | 1,000,000 | 71.0% | 121.21K | 500,000 | 20% |
| sUSDe | 3.88K | 28,000,000 | 0.01% | non-borrowable | non-borrowable | 20% |
| USDC | 3.32M | 37,500,000 | 8.9% | 57.37K | 28,000,000 | 10% |
Cap Reductions
Tighten supply caps to levels above current utilization, with sUSDe retaining a 500K supply cap to accommodate potential renewed activity in this asset, and reduce stablecoin borrow caps such that combined available borrow capacity (above current outstanding stable borrows) is approximately 600K. APT borrow cap is reduced to a value closely aligned with current outstanding borrows. This combination partially mitigates exposure while leaving existing positions fully functional. Current borrowers can continue to repay, withdraw excess collateral, and add collateral to manage their health factor. Current suppliers retain adequate headroom within the tightened caps to manage their positions.
The combined ~600K stable borrow capacity is allocated weighted toward USDT where active borrow demand sits (USDT 1,200K cap on 700.67K outstanding; USDC 150K cap on 57.37K outstanding).
| Asset | Parameter | Current | Proposed |
|---|---|---|---|
| USDT | Supply Cap | 60,000,000 | 4,500,000 |
| USDT | Borrow Cap | 45,000,000 | 1,200,000 |
| APT | Supply Cap | 1,000,000 | 900,000 |
| APT | Borrow Cap | 500,000 | 150,000 |
| sUSDe | Supply Cap | 28,000,000 | 500,000 |
| USDC | Supply Cap | 37,500,000 | 4,200,000 |
| USDC | Borrow Cap | 28,000,000 | 150,000 |
Specification
| Asset | Supply Cap | Borrow Cap |
|---|---|---|
| USDT | 60,000,000 → 4,500,000 | 45,000,000 → 1,200,000 |
| APT | 1,000,000 → 900,000 | 500,000 → 150,000 |
| sUSDe | 28,000,000 → 500,000 | – |
| USDC | 37,500,000 → 4,200,000 | 28,000,000 → 150,000 |
Next Steps
Given the deployment is on Launch Guardian, Aave Labs will proceed with execution of the cap reductions outlined above.
Disclosure
This review was independently prepared by LlamaRisk, a DeFi risk service provider funded in part by the Aave DAO. LlamaRisk is not directly affiliated with the protocol(s) reviewed in this assessment and did not receive any compensation from the protocol(s) or their affiliated entities for this work.
The information provided should not be construed as legal, financial, tax, or professional advice.