Summary
LlamaRisk recommends the following parameter changes based on user behavior, on-chain liquidity, and position health observed in the latest review of Aave V3 reserves.
Aave V3 Monad:
- Increase supply cap for USDC from 150,000,000 to 250,000,000.
- Increase borrow cap for USDC from 135,000,000 to 225,000,000.
- Increase supply cap for GHO from 20,000,000 to 40,000,000.
- Increase borrow cap for GHO from 18,000,000 to 36,000,000.
- Increase supply cap for USDe from 80,000,000 to 100,000,000.
Aave V3 Core:
- Increase supply cap for BTC.b from 160 to 225.
USDC (Aave V3 Monad)
USDC has reached 93.0% supply cap utilization (139,428,304 / 150,000,000) and 92.8% borrow cap utilization (125,340,712 / 135,000,000) on the Aave V3 Monad instance.
Supply Distribution
Source: LlamaRisk, August 11, 2026
The top USDC suppliers hold the asset predominantly on a spot basis, with seventeen of the twenty carrying no offsetting debt and the levered remainder running health factors between 1.01 and 1.07. Those carrying debt borrow USDe against USDC collateral, meaning both legs of the position are dollar-denominated. Since USDe is priced at par with USDT, the health factor consequently tracks the USDT peg.
Borrow Distribution
Source: LlamaRisk, August 11, 2026
The top USDC borrowers all carry outstanding debt, with health factors between 1.01 and 1.14 and a median of 1.02. Collateral is posted in syrupUSDC and USDe against USDC and USDT0 debt, so the cohort is dollar denominated on both legs and health factor stability tracks those collateral assets holding their peg.
Recommendation
We recommend raising the supply cap from 150,000,000 to 250,000,000 and the borrow cap from 135,000,000 to 225,000,000 on Aave V3 Monad. Both legs stand above 92% utilization and supply has grown approximately 30% over the past eight days, with the proposed caps landing at approximately 55.8% and 55.7% post-change utilization respectively.
GHO (Aave V3 Monad)
GHO has reached 93.0% supply cap utilization (18,605,503 / 20,000,000) and 75.0% borrow cap utilization (13,508,857 / 18,000,000) on the Aave V3 Monad instance.
Supply Distribution
Source: LlamaRisk, August 11, 2026
The top GHO suppliers hold the asset almost entirely on a spot basis, with 18 of the 19 carrying no offsetting debt and the single levered position running a health factor of 1.11. Supply-side positions therefore carry negligible liquidation exposure, and health factor risk in this reserve sits on the borrow side.
Borrow Distribution
Source: LlamaRisk, August 11, 2026
The top GHO borrowers all carry outstanding debt, with health factors between 1.01 and 1.45 and a median of 1.03. Collateral is led by syrupUSDC and USDe against GHO debt, so the cohort holds dollar denominated collateral against dollar denominated borrowings and health factor stability tracks those collateral assets holding their peg.
Recommendation
We recommend raising the supply cap from 20,000,000 to 40,000,000 and the borrow cap from 18,000,000 to 36,000,000 on Aave V3 Monad. Supply cap utilization stands at 93.0% with supply up approximately 61% over the past eight days, and borrow cap utilization stands at 75.0%, with the proposed caps landing at approximately 46.5% and 37.5% post-change utilization respectively.
USDe (Aave V3 Monad)
USDe has reached 100.0% supply cap utilization (80,001,774 / 80,000,000) on the Aave V3 Monad instance.
Supply Distribution
Source: LlamaRisk, August 11, 2026
The top USDe suppliers run health factors between 1.01 and 2.48 with a median of 1.02, and nineteen of the twenty carry outstanding debt. Borrowing is denominated in USDT0 and USDC against USDe collateral held in the stablecoin E-Mode category at LTV 90.0% and LT 92.0%, so health factor stability tracks the USDT peg, because USDe is priced on par with USDT.
Recommendation
We recommend raising the supply cap from 80,000,000 to 100,000,000 on Aave V3 Monad. The reserve is at its current ceiling, and the proposed cap lands at approximately 80.0% post-change cap utilization while the supplier base borrows stablecoins against USDe collateral. The borrow cap is held unchanged at 36,000,000.
BTC.b (Aave V3 Core)
BTC.b is currently at 38.4% supply cap utilization (61 / 160) on the Aave V3 Core instance.
Supply Distribution
Source: LlamaRisk, August 11, 2026
The top BTC.b suppliers run health factors between 1.13 and 2.21 with a median of 1.46, and eight of the nine carry outstanding debt. Borrowing is denominated entirely in stablecoins and led by USDe, so the cohort holds stablecoin borrowings against BTC.b collateral whose health factor stability tracks the BTC price.
Recommendation
We recommend raising the supply cap from 160 to 225 on Aave V3 Core. The reserve stands at 38.4% supply cap utilization and the proposed cap lands at approximately 27.3% post-change cap utilization.
Specification
| Instance | Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|
| Aave V3 Monad | USDC | 150,000,000 | 250,000,000 | 135,000,000 | 225,000,000 |
| Aave V3 Monad | GHO | 20,000,000 | 40,000,000 | 18,000,000 | 36,000,000 |
| Aave V3 Monad | USDe | 80,000,000 | 100,000,000 | 36,000,000 | - |
| Aave V3 Core | BTC.b | 160 | 225 | - | - |
Next Steps
We will move forward and implement these updates via the Risk Steward process.
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.