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 Tokenization Spoke from 1M to 2M.
-
Increase the draw cap for USDC on the Core Hub Main Spoke from 40M to 50M.
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Increase the draw cap for USDT on the Core Hub Main Spoke from 20M to 30M.
-
Increase the draw cap for USDG on the Global Dollar Hub USDG Maple Spoke from 46.4M to 55M.
Aave V4 Arc:
- Increase the draw cap for USDC on the Core Hub USDC Maple Spoke from 41.6M to 50M.
Cap Utilization
The chart shows add cap utilization (left) and draw cap utilization (right) for Aave V4 reserves at or above 50% of either cap, split by hub. The draw cap panel excludes cross-hub credit lines, which are draw-only legs through which a spoke borrows from a hub against collateral supplied on another hub.
Source: LlamaRisk, November 4, 2026
USDC (Core Hub)
As of November 4, 2026, USDC sits at 89.1% draw cap utilization on the Main Spoke (35.65M / 40M).
USDC Main Spoke Borrow Distribution
Source: LlamaRisk, November 4, 2026
USDC borrowing on the Main Spoke is moderately concentrated, with the largest position holding approximately 14% of the drawn amount and the top twenty approximately 60%. The largest borrowers hold USDC debt mainly against ETH-denominated collateral (wstETH, WETH, and weETH) and BTC-denominated collateral (WBTC and cbBTC) at health factors between 1.18 and 3.70 with a median of 1.51, so HF in the cohort tracks the ETH and BTC prices.
Recommendation
The proposed USDC Core Main Spoke draw cap of 50M lands at approximately 71.3% post-change draw cap utilization.
We also recommend doubling USDC Tokenization Spoke add cap to 2M which currently is 59% utilized. It is a supply-only integration layer that tokenizes deposits of the Core Hub’s borrowable USDC into composable positions for external vaults, aggregators, and strategies, without enabling borrowing or introducing additional collateral risk to the Core Hub.
USDT (Core Hub)
As of November 4, 2026, USDT sits at 72.4% draw cap utilization on the Main Spoke (14.48M / 20M).
USDT Main Spoke Borrow Distribution
Source: LlamaRisk, November 4, 2026
USDT borrowing on the Main Spoke is moderately concentrated, with the largest position holding approximately 9% of the drawn amount and the top twenty approximately 60%. The largest borrowers hold USDT debt mainly against WETH, WBTC, and wstETH collateral at health factors between 1.33 and 13.57 with a median of 1.76, so HF in the cohort tracks the ETH and BTC prices.
Recommendation
The proposed draw cap of 30M lands at approximately 48.3% post-change draw cap utilization, at which point the 1.72M of USDT liquidity available on the Core Hub, where utilization stands at 93.0% against an optimal usage ratio of 92.00%, becomes the limit on further draws.
USDG (Global Dollar Hub)
As of November 4, 2026, USDG sits at 92.2% draw cap utilization on the USDG Maple Spoke (42.79M / 46.4M).
USDG Maple Spoke Borrow Distribution
Source: LlamaRisk, November 4, 2026
USDG borrowing on the USDG Maple Spoke is concentrated, with the largest position holding approximately 23% of the drawn amount, the top three approximately 46%, and the top ten approximately 90%. All top twenty hold USDG debt against syrupUSDG collateral, in four cases alongside USDG drawn from the Core Hub, at health factors between 1.01 and 1.27 with a median of 1.02; as collateral and debt are both dollar-denominated, HF in the cohort tracks the syrupUSDG/USDG exchange rate.
Recommendation
The proposed draw cap of 55M lands at approximately 77.8% post-change draw cap utilization, at which point the 8.32M of USDG liquidity available on the Global Dollar Hub, where utilization stands at 84.6% against an optimal usage ratio of 90.00%, becomes the limit on further draws.
USDC (Arc Core Hub)
As of November 4, 2026, USDC sits at 100.0% draw cap utilization on the USDC Maple Spoke.
USDC Maple Spoke Borrow Distribution
Source: LlamaRisk, November 4, 2026
USDC borrowing on the USDC Maple Spoke is highly concentrated, with the largest position holding approximately 37% of the drawn amount, the top three approximately 74%, and the top five approximately 91%. 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 in the cohort tracks the syrupUSDC/USDC exchange rate.
Recommendation
The proposed draw cap of 50M lands at approximately 83.2% post-change draw cap utilization, and the 8.40M of added room is within the 46.46M of USDC liquidity available on the Arc Core Hub, where utilization stands at 66.1% against an optimal usage ratio of 90.00%.
Specification
Add Caps
| Hub | Spoke | Asset | Current Add Cap | Recommended Add Cap |
|---|---|---|---|---|
| Ethereum Core | Tokenization | USDC | 1,000,000 | 2,000,000 |
Draw Caps
| Hub | Spoke | Asset | Current Draw Cap | Recommended Draw Cap |
|---|---|---|---|---|
| Ethereum Core | Main | USDC | 40,000,000 | 50,000,000 |
| Ethereum Core | Main | USDT | 20,000,000 | 30,000,000 |
| Ethereum Global Dollar | USDG Maple | USDG | 46,400,000 | 55,000,000 |
| Arc Core | USDC Maple | USDC | 41,600,000 | 50,000,000 |
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.