# Risk Stewards: Borrow Cap Increases on Aave V3 / 2026.11.01 **URL:** \ **Category:** Risk\ **Created:** [November 1, 2026, 5:18pm UTC](https://governance.aave.com/t/risk-stewards-borrow-cap-increases-on-aave-v3-2026-11-01/25974 "2026-11-01T17:18:44Z")\ **Posts on this page:** 1\ **Page:** 1
**Author:** ![LlamaRisk](https://dub1.discourse-cdn.com/flex013/user_avatar/governance.aave.com/llamarisk/32/12865_2.png) [@LlamaRisk](https://governance.aave.com/u/LlamaRisk)\ **Post date:** [November 1, 2026, 5:18pm UTC](https://governance.aave.com/t/risk-stewards-borrow-cap-increases-on-aave-v3-2026-11-01/25974/1 "2026-11-01T17:18:44Z")
## Summary LlamaRisk recommends the following parameter changes based on user behavior, on-chain liquidity, and position health observed in the latest review of the Aave V3 borrow caps reduced on October 30, 2026. Aave V3 Core: - Increase borrow cap for WETH from 1,790,000 to 1,810,000. - Increase borrow cap for EURC from 26,600,000 to 30,000,000. Aave V3 Prime: - Increase borrow cap for WETH from 16,100 to 17,000. Aave V3 Polygon: - Increase borrow cap for USDT0 from 22,200,000 to 23,000,000. Aave V3 X Layer: - Increase borrow cap for USD₮0 from 30,300,000 to 35,000,000. ## Borrow Cap Utilization The borrow caps reduced on October 30, 2026 have been in force since the reserves were unfrozen later that day. On the reserves below, borrowing has grown since the reduction, and debt now uses between 98.3% and 100% of each borrow cap. ![image](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/5/5092fe98d3f69bafc1bf4dfa354164d39b7edbc4.png) _Source: LlamaRisk, November 1, 2026_ | Instance | Asset | Debt at Reduction | Debt Now | Change | Current Borrow Cap | Cap Use | Recommended Borrow Cap | Post-Change Cap Use | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Aave V3 Core | WETH | 1,749,715 | 1,778,949 | +1.7% | 1,790,000 | 99.4% | 1,810,000 | 98.3% | | Aave V3 Prime | WETH | 15,729 | 16,099 | +2.4% | 16,100 | 100.0% | 17,000 | 94.7% | | Aave V3 Core | EURC | 25,976,680 | 26,159,629 | +0.7% | 26,600,000 | 98.3% | 30,000,000 | 87.2% | | Aave V3 Polygon | USDT0 | 21,624,080 | 21,820,811 | +0.9% | 22,200,000 | 98.3% | 23,000,000 | 94.9% | | Aave V3 X Layer | USD₮0 | 29,571,680 | 30,294,224 | +2.4% | 30,300,000 | 100.0% | 35,000,000 | 86.6% | _Source: LlamaRisk, November 1, 2026, 13:00 UTC_ ## WETH (Aave V3 Core) WETH on Aave V3 Core holds 2,098,953 WETH of supply against 1,778,949 WETH of debt, a utilization of 84.8% against an optimal utilization of 92%. Debt has grown by approximately 29,200 WETH since the reduction, reached the 1,790,000 borrow cap, and now uses 99.4% of it. ### Borrow Distribution ![image](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/8/823d3d630192ad6b5006677e7944e980d9494138.png) _Source: LlamaRisk, November 1, 2026_ WETH debt on Aave V3 Core is concentrated in a small number of large positions. The two largest borrowers hold approximately 23% and 18% of the reserve’s debt, and the top twenty approximately 80%. Nearly all of them borrow WETH against liquid restaking and staking tokens, led by weETH, rsETH and wstETH, at health factors between 1.01 and 3.56 with a median of 1.04, so HF in the cohort tracks the exchange rate of each collateral token against ETH. ### Recommendation The proposed borrow cap of 1,810,000 lands at approximately 98.3% post-change borrow cap utilization. ## WETH (Aave V3 Prime) WETH on Aave V3 Prime holds 18,893 WETH of supply against 16,099 WETH of debt, a utilization of 85.2% against an optimal utilization of 92%. Debt has grown by approximately 370 WETH since the reduction and fully uses the 16,100 borrow cap. ### Borrow Distribution ![image](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/8/82956e7c772fe9a39ec8be23204f8a0e8b262e76.png) _Source: LlamaRisk, November 1, 2026_ The largest borrower holds approximately 42% of the reserve’s debt and the top ten approximately 87%. Every position in the top twenty borrows WETH against wstETH at health factors between 1.00 and 2.38 with a median of 1.05, so HF in the cohort tracks the wstETH/ETH exchange rate. ### Recommendation The proposed borrow cap of 17,000 lands at approximately 94.7% post-change borrow cap utilization. ## EURC (Aave V3 Core) EURC on Aave V3 Core holds 35.61M EURC of supply against 26.16M EURC of debt, a utilization of 73.5% against an optimal utilization of 90%. Debt uses 98.3% of the 26,600,000 borrow cap and reached 98.9% after the unfreeze. ### Borrow Distribution ![image](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/8/83a304b5f3a71dd042815a1bd69d7d5d4dd190ba.png) _Source: LlamaRisk, November 1, 2026_ The largest borrower holds approximately 15% of the reserve’s debt and the top three approximately 41%. Borrowers post cbBTC, WETH and WBTC as collateral at health factors between 1.42 and 9.50 with a median of 1.92, so HF in the cohort tracks the ETH and BTC prices against the euro. ### Recommendation The proposed borrow cap of 30,000,000 lands at approximately 87.2% post-change borrow cap utilization. ## USDT0 (Aave V3 Polygon) USDT0 on Aave V3 Polygon holds 31.18M USDT0 of supply against 21.82M USDT0 of debt, a utilization of 70.0% against an optimal utilization of 90%. Debt uses 98.3% of the 22,200,000 borrow cap. ### Borrow Distribution ![image](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/f/fed3be3236071e9304096dced1696c7f52809e13.png) _Source: LlamaRisk, November 1, 2026_ The largest borrower holds approximately 12% of the reserve’s debt and the top ten approximately 43%. Borrowers post mainly WBTC, and to a lesser extent WETH, as collateral at health factors between 1.06 and 3.34 with a median of 1.49, so HF in the cohort tracks the BTC and ETH prices. ### Recommendation The proposed borrow cap of 23,000,000 lands at approximately 94.9% post-change borrow cap utilization. ## USD₮0 (Aave V3 X Layer) USD₮0 on Aave V3 X Layer holds 37.33M USD₮0 of supply against 30.29M USD₮0 of debt, a utilization of 81.2% against an optimal utilization of 90%. Debt has grown by approximately 0.72M USD₮0 since the reduction and fully uses the 30,300,000 borrow cap. ### Borrow Distribution ![image](https://europe1.discourse-cdn.com/flex013/uploads/aave/original/2X/2/272c3bde12e8d55184b39ccba547af1066c453c9.png) _Source: LlamaRisk, November 1, 2026_ The largest borrower holds approximately 26% of the reserve’s debt against USDe collateral. Most other positions in the top twenty borrow USD₮0 against PT-USDG-25FEB2027. The cohort runs health factors between 1.03 and 1.10 with a median of 1.05, so HF tracks the PT and USDe exchange rates against USD₮0. ### Recommendation The proposed borrow cap of 35,000,000 lands at approximately 86.6% post-change borrow cap utilization. ## Specification ### Borrow Caps | Instance | Asset | Current Borrow Cap | Recommended Borrow Cap | | --- | --- | --- | --- | | Aave V3 Core | WETH | 1,790,000 | 1,810,000 | | Aave V3 Core | EURC | 26,600,000 | 30,000,000 | | Aave V3 Prime | WETH | 16,100 | 17,000 | | Aave V3 Polygon | USDT0 | 22,200,000 | 23,000,000 | | Aave V3 X Layer | USD₮0 | 30,300,000 | 35,000,000 | ## Next Steps We will move forward and implement these updates via the Risk Steward process. We will continue to monitor borrowing on the reserves whose borrow caps were reduced on October 30, 2026. The implemented changes can be reviewed on the [LlamaRisk Risk Stewards Dashboard](https://dashboard.llamarisk.com/protocols/aave/risk-parameter-updates). ## 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.