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 Core:
- Increase supply cap for BTC.b from 40 to 80.
BTC.b (Aave V3 Core)
BTC.b sits at 49.8% supply cap utilization (19.93 / 40) on the Aave V3 Core instance. The reserve is configured as collateral-only, so the supply cap is the only active gate on reserve growth.
Supply Distribution
Source: LlamaRisk, August 3, 2026
The top BTC.b suppliers run health factors between 1.12 and 2.06 with a median of 1.50, and eight of the nine holders with material balances carry outstanding debt. Borrowing is spread across USDe, GHO, USDT, and USDC, with four users borrowing USDC and three each borrowing USDe and USDT. All debt in the cohort is denominated in stablecoins, so HF stability tracks the BTC price.
Recommendation
We recommend increasing the BTC.b supply cap from 40 to 80 on Aave V3 Core. The new cap is approximately 4.0x current outstanding supply and lands at approximately 24.9% post-change cap utilization. The supplier base borrows predominantly stablecoins against BTC.b collateral. Borrowing remains disabled on the reserve, so the borrow cap is held unchanged.
Specification
| Instance | Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|
| Aave V3 Core | BTC.b | 40 | 80 | - | - |
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.