Summary
LlamaRisk recommends the following parameter changes based on user behavior, on-chain liquidity, and position health observed in the latest review of Aave V4 reserves.
Aave V4 Ethereum:
- Increase the add cap for USDC on the Core Hub Main Spoke from 50M to 75M.
- Increase the draw cap for USDC on the Core Hub Forex Spoke from 5M to 8M.
- Increase the draw cap for USDC on the Core Hub Gold Spoke from 1M to 2M.
- Increase the draw cap for USDC on the Core Hub Bluechip Spoke from 6M to 9M.
- Increase the add cap for USDG on the Core Hub Main Spoke from 90M to 110M.
- Increase the draw cap for USDG on the Core Hub Main Spoke from 60M to 75M.
- Increase the draw cap for USDG on the Core Hub Bluechip Spoke from 5M to 8M.
- Increase the add cap for WETH on the Core Hub Main Spoke from 60K to 90K.
- Increase the draw cap for WETH on the Core Hub EtherFi Spoke from 45K to 60K.
- Increase the add cap for weETH on the Core Hub EtherFi Spoke from 55K to 65K.
- Increase the add cap for LINK on the Core Hub Main Spoke from 900K to 1.8M.
Aave V4 Arc:
- Increase the draw cap for USDC on the Core Hub USDC Maple Spoke from 46M to 75M.
- Increase the add cap for syrupUSDC on the Core Hub USDC Maple Spoke from 50M to 75M.
USDC (Core Hub)
USDC on the Core Hub holds 49.04M added and 38.22M drawn, for a hub utilization of 77.9% against an optimal usage ratio of 92.00%. Available hub liquidity stands at 10.82M USDC.
| Spoke | Added | Add Cap | Add Cap Utilization | Drawn | Draw Cap | Draw Cap Utilization |
|---|---|---|---|---|---|---|
| Main | 40,758,895 | 50,000,000 | 81.5% | 23,430,152 | 36,000,000 | 65.1% |
| Forex | 7,999,045 | 15,000,000 | 53.3% | 4,998,115 | 5,000,000 | 100.0% |
| Gold | 0 | 0 | 790,974 | 1,000,000 | 79.1% | |
| Bluechip | 0 | 0 | 6,000,015 | 6,000,000 | 100.0% |
USDC Supply Distribution
Source: LlamaRisk, October 26, 2026
USDC supply on the Main Spoke is dispersed, with the largest position holding approximately 5% of the reserve, the top ten approximately 28%, and the top twenty approximately 40%.
Recommendation
The proposed add cap of 75M on the Main Spoke lands at approximately 54.3% post-change add cap utilization, giving room for additional USDC supply to the hub. The USDC draw cap on the Forex Spoke is fully utilized; the proposed 8M draw cap lands at approximately 62.5% post-change draw-cap utilization. The proposed draw cap of 2M on the Gold Spoke lands at approximately 39.5% post-change draw cap utilization. The USDC draw cap on the Bluechip Spoke is fully utilized; the proposed 9M draw cap lands at approximately 66.7% post-change draw cap utilization.
USDG (Core Hub)
USDG on the Core Hub holds 88.57M added and 71.04M drawn, for a hub utilization of 80.2% against an optimal usage ratio of 90.00%. Available hub liquidity stands at 17.53M USDG.
| Spoke | Added | Add Cap | Add Cap Utilization | Drawn | Draw Cap | Draw Cap Utilization |
|---|---|---|---|---|---|---|
| Main | 88,300,932 | 90,000,000 | 98.1% | 54,287,466 | 60,000,000 | 90.5% |
| Bluechip | 0 | 0 | 5,001,052 | 5,000,000 | 100.0% |
USDG Supply Distribution
Source: LlamaRisk, October 26, 2026
USDG supply on the Main Spoke is moderately concentrated, with the largest position holding approximately 25% of the reserve, the top three approximately 41%, and the top twenty approximately 63%.
Recommendation
The USDG add cap on the Main Spoke is 98.1% utilized and the draw cap is 90.5% utilized. The proposed add cap of 110M lands at approximately 80.3% post-change add cap utilization, and the proposed draw cap of 75M at approximately 72.4% post-change draw cap utilization. The USDG draw cap on the Bluechip Spoke is fully utilized; the proposed draw cap of 8M lands at approximately 62.5% post-change draw cap utilization.
WETH and weETH (Core Hub)
WETH on the Core Hub holds 46,246 added and 41,572 drawn, for a hub utilization of 89.9% against an optimal usage ratio of 92.00%. Available hub liquidity stands at 4,674 WETH. The EtherFi Spoke accounts for 40,121 WETH drawn.
| Spoke | Asset | Added | Add Cap | Add Cap Utilization | Drawn | Draw Cap | Draw Cap Utilization |
|---|---|---|---|---|---|---|---|
| Main | WETH | 46,208 | 60,000 | 77.0% | 221 | 3,300 | 6.7% |
| EtherFi | WETH | 0 | 0 | 40,121 | 45,000 | 89.2% | |
| EtherFi | weETH | 38,989 | 55,000 | 70.9% | 0 | 0 |
WETH Supply Distribution
Source: LlamaRisk, October 26, 2026
WETH supply on the Main Spoke is moderately concentrated, with the largest position holding approximately 13% of the reserve and the top twenty approximately 54%. Most of the largest suppliers borrow stablecoins against WETH collateral, mainly USDG and to a lesser extent USDC and USDT, at health factors between 1.14 and 13.0 with a median of 1.76, so HF in the cohort tracks the ETH price.
weETH Supply Distribution
Source: LlamaRisk, October 26, 2026
weETH supply on the EtherFi Spoke is concentrated, with the largest position holding approximately 37% of the reserve and the top twenty approximately 96%. The largest suppliers all borrow WETH against weETH collateral at health factors between 1.00 and 1.09 with a median of 1.01, so HF in the cohort tracks the weETH/ETH exchange rate.
Recommendation
The proposed WETH add cap of 90K on the Main Spoke lands at approximately 51.3% post-change add cap utilization. The proposed WETH draw cap of 60K on the EtherFi Spoke lands at approximately 66.9% post-change draw cap utilization. The proposed weETH add cap of 65K on the EtherFi Spoke lands at approximately 60.0% post-change add cap utilization.
LINK (Core Hub)
LINK on the Core Hub holds 726,896 added on the Main Spoke against an add cap of 900K (80.8%). LINK is not borrowable on the Core Hub.
LINK Supply Distribution
Source: LlamaRisk, October 26, 2026
LINK supply on the Main Spoke is more dispersed, with the two largest positions holding approximately 23% of the reserve and the top twenty approximately 73%. Most of the largest suppliers borrow stablecoins against LINK collateral, mainly USDC and to a lesser extent USDG and USDT, at health factors between 1.24 and 12.3 with a median of 1.88, so HF in the cohort tracks the LINK price.
Recommendation
The proposed add cap of 1.8M lands at approximately 40.4% post-change add cap utilization.
USDC and syrupUSDC (Arc Core Hub)
USDC on the Aave V4 Arc Core Hub holds 143.45M added and 109.77M drawn, for a hub utilization of 76.5% against an optimal usage ratio of 90.00%. Available hub liquidity stands at 33.68M USDC. On the USDC Maple Spoke, 43.13M USDC is drawn against a draw cap of 46M (93.8%), and 40.23M syrupUSDC is added against an add cap of 50M (80.5%).
syrupUSDC Supply Distribution
Source: LlamaRisk, October 26, 2026
syrupUSDC supply on the USDC Maple Spoke is concentrated, with the largest position holding approximately 77% of the reserve. Borrowing positions hold USDC debt against syrupUSDC collateral at health factors between 1.00 and 1.49 with a median of 1.02; as collateral and debt are both dollar-denominated, HF of the positions tracks the syrupUSDC/USDC exchange rate.
Recommendation
The proposed USDC draw cap of 75M lands at approximately 57.5% post-change draw cap utilization, and the proposed syrupUSDC add cap of 75M at approximately 53.6% post-change add cap utilization.
Specification
Add Caps
| Hub | Spoke | Asset | Current Add Cap | Recommended Add Cap |
|---|---|---|---|---|
| Ethereum Core | Main | USDC | 50,000,000 | 75,000,000 |
| Ethereum Core | Main | USDG | 90,000,000 | 110,000,000 |
| Ethereum Core | Main | WETH | 60,000 | 90,000 |
| Ethereum Core | EtherFi | weETH | 55,000 | 65,000 |
| Ethereum Core | Main | LINK | 900,000 | 1,800,000 |
| Arc Core | USDC Maple | syrupUSDC | 50,000,000 | 75,000,000 |
Draw Caps
| Hub | Spoke | Asset | Current Draw Cap | Recommended Draw Cap |
|---|---|---|---|---|
| Ethereum Core | Forex | USDC | 5,000,000 | 8,000,000 |
| Ethereum Core | Gold | USDC | 1,000,000 | 2,000,000 |
| Ethereum Core | Bluechip | USDC | 6,000,000 | 9,000,000 |
| Ethereum Core | Main | USDG | 60,000,000 | 75,000,000 |
| Ethereum Core | Bluechip | USDG | 5,000,000 | 8,000,000 |
| Ethereum Core | EtherFi | WETH | 45,000 | 60,000 |
| Arc Core | USDC Maple | USDC | 46,000,000 | 75,000,000 |
Next Steps
We will move forward and implement these updates via the Risk Steward process. The implemented changes can be reviewed on the LlamaRisk Risk Stewards Dashboard.
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.