Summary
Following the temporary Slope2 reductions recommended on October 30, 2026 in response to the Binance hot wallet incident of October 29, 2026, LlamaRisk recommends restoring Slope2 on each affected reserve to the value in effect before the incident. The affected reserves are no longer frozen. The base rate, Slope1 and optimal utilization point are unchanged, so borrow rates at or below the optimal point are unaffected.
Aave V3 Core:
- Increase Slope2 for USDC from 5.50% to 10.00%.
- Increase Slope2 for USDT from 5.50% to 10.00%.
- Increase Slope2 for DAI from 15.00% to 35.00%.
- Increase Slope2 for USDtb from 30.00% to 50.00%.
Aave V3 Plasma:
- Increase Slope2 for USDT0 from 5.50% to 10.00%.
Aave V3 Base:
- Increase Slope2 for USDC from 5.25% to 10.00%.
Aave V3 Mantle:
- Increase Slope2 for USDT0 from 6.00% to 10.00%.
Aave V3 Monad:
- Increase Slope2 for USDC from 5.00% to 20.00%.
- Increase Slope2 for USDT0 from 5.00% to 20.00%.
- Increase Slope2 for mUSD from 20.00% to 40.00%.
- Increase Slope2 for GHO from 5.00% to 20.00%.
Aave V3 Avalanche:
- Increase Slope2 for USDC from 5.50% to 10.00%.
- Increase Slope2 for USDt from 5.50% to 10.00%.
Aave V3 Optimism:
- Increase Slope2 for USDC from 6.00% to 10.00%.
Aave V3 Horizon:
- Increase Slope2 for RLUSD from 5.00% to 25.00%.
Aave V4 Ethereum:
- Increase slope2 for USDT on the Core Hub from 5.50% to 20.00%.
- Increase slope2 for USDG on the Core Hub from 6.00% to 20.00%.
- Increase slope2 for USDC on the Core Hub from 4.50% to 20.00%.
- Increase slope2 for frxUSD on the Core Hub from 15.00% to 35.00%.
- Increase slope2 for WETH on the Core Hub from 7.80% to 8.00%.
- Increase slope2 for USDG on the Global Dollar Hub from 6.00% to 20.00%.
Aave V4 Arc:
- Increase slope2 for USDC on the Core Hub from 5.90% to 10.00%.
Rationale
As of October 31, 2026, the Aave V3 and Aave V4 reserves frozen during the incident are no longer frozen and accept new supply and borrowing. The slope2 reductions earlier limited the variable borrow rate at full utilization to 10.00% APR on most reserves, which narrows the rate response available to restore withdrawal liquidity on reserves operating above the optimal point. Restoring the previous Slope2 returns each reserve to the curve in effect before the incident.
Aave V3
| Instance | Asset | Supplied (USD) | Utilization | uOptimal | Current Borrow APR | New Borrow APR | Current APR at 100% | New APR at 100% |
|---|---|---|---|---|---|---|---|---|
| Aave V3 Core | USDC | 2,342M | 94.0% | 94% | 4.50% | 4.50% | 10.00% | 14.50% |
| Aave V3 Core | USDT | 2,573M | 94.8% | 92% | 6.46% | 8.06% | 10.00% | 14.50% |
| Aave V3 Core | DAI | 125M | 85.9% | 92% | 4.67% | 4.67% | 20.00% | 40.00% |
| Aave V3 Core | USDtb | 11.3M | 80.6% | 80% | 4.89% | 5.49% | 34.00% | 54.00% |
| Aave V3 Plasma | USDT0 | 728M | 94.1% | 94% | 4.56% | 4.60% | 10.00% | 14.50% |
| Aave V3 Base | USDC | 181M | 95.6% | 90% | 7.69% | 10.35% | 10.00% | 14.75% |
| Aave V3 Mantle | USDT0 | 151M | 85.7% | 90% | 3.81% | 3.81% | 10.00% | 14.00% |
| Aave V3 Monad | USDC | 130M | 91.5% | 92% | 4.97% | 4.97% | 10.00% | 25.00% |
| Aave V3 Monad | USDT0 | 49.5M | 92.4% | 92% | 5.22% | 5.88% | 10.00% | 25.00% |
| Aave V3 Monad | mUSD | 42.6M | 71.2% | 80% | 4.45% | 4.45% | 25.00% | 45.00% |
| Aave V3 Monad | GHO | 9.2M | 86.2% | 92% | 4.69% | 4.69% | 10.00% | 25.00% |
| Aave V3 Avalanche | USDC | 64.0M | 97.7% | 90% | 8.75% | 12.24% | 10.00% | 14.50% |
| Aave V3 Avalanche | USDt | 24.1M | 93.8% | 90% | 6.60% | 8.31% | 10.00% | 14.50% |
| Aave V3 Optimism | USDC | 10.0M | 94.3% | 90% | 6.61% | 8.35% | 10.00% | 14.00% |
| Aave V3 Horizon | RLUSD | 133M | 57.7% | 90% | 3.21% | 3.21% | 10.00% | 30.00% |
Source: LlamaRisk, October 31, 2026, 18:05 UTC
Aave V4
Aave V4 sets the interest rate model per hub asset, so each change applies to every spoke drawing from that hub.
| Hub | Asset | Added (USD) | Utilization | Optimal Usage Ratio | Current Drawn APR | New Drawn APR | Current APR at 100% | New APR at 100% |
|---|---|---|---|---|---|---|---|---|
| Arc Core | USDC | 98.3M | 80.7% | 90% | 3.68% | 3.68% | 10.00% | 14.10% |
| Ethereum Core | USDT | 24.2M | 95.5% | 92% | 6.89% | 13.21% | 10.00% | 24.50% |
| Ethereum Core | USDG | 75.1M | 89.6% | 90% | 3.98% | 3.98% | 10.00% | 24.00% |
| Ethereum Core | USDC | 53.3M | 94.1% | 92% | 6.17% | 10.19% | 9.50% | 25.00% |
| Ethereum Core | frxUSD | 27.8M | 84.9% | 90% | 3.77% | 3.77% | 19.00% | 39.00% |
| Ethereum Core | WETH | 98.3M | 91.3% | 92% | 2.18% | 2.18% | 10.00% | 10.20% |
| Ethereum Global Dollar | USDG | 54.2M | 82.7% | 90% | 3.68% | 3.68% | 10.00% | 24.00% |
Source: LlamaRisk, October 31, 2026, 18:05 UTC
Specification
Aave V3 Slope 2
| Instance | Asset | Current Slope 2 | Recommended Slope 2 |
|---|---|---|---|
| Aave V3 Core | USDC | 5.50% | 10.00% |
| Aave V3 Core | USDT | 5.50% | 10.00% |
| Aave V3 Core | DAI | 15.00% | 35.00% |
| Aave V3 Core | USDtb | 30.00% | 50.00% |
| Aave V3 Plasma | USDT0 | 5.50% | 10.00% |
| Aave V3 Base | USDC | 5.25% | 10.00% |
| Aave V3 Mantle | USDT0 | 6.00% | 10.00% |
| Aave V3 Monad | USDC | 5.00% | 20.00% |
| Aave V3 Monad | USDT0 | 5.00% | 20.00% |
| Aave V3 Monad | mUSD | 20.00% | 40.00% |
| Aave V3 Monad | GHO | 5.00% | 20.00% |
| Aave V3 Avalanche | USDC | 5.50% | 10.00% |
| Aave V3 Avalanche | USDt | 5.50% | 10.00% |
| Aave V3 Optimism | USDC | 6.00% | 10.00% |
| Aave V3 Horizon | RLUSD | 5.00% | 25.00% |
Aave V4 Slope 2
| Hub | Asset | Current Slope 2 | Recommended Slope 2 |
|---|---|---|---|
| Arc Core | USDC | 5.90% | 10.00% |
| Ethereum Core | USDT | 5.50% | 20.00% |
| Ethereum Core | USDG | 6.00% | 20.00% |
| Ethereum Core | USDC | 4.50% | 20.00% |
| Ethereum Core | frxUSD | 15.00% | 35.00% |
| Ethereum Core | WETH | 7.80% | 8.00% |
| Ethereum Global Dollar | USDG | 6.00% | 20.00% |
Next Steps
We will move forward and implement these updates via the Risk Steward process, with the Aave V3 Horizon change executed by the Horizon Operations multisig. The implemented changes can be reviewed on the respective LlamaRisk Aave V3 Risk Stewards Dashboard and Aave V4 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.