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:
- Reduce supply cap for tBTC from 2,500 to 1,800.
Cap Reductions
The reserve below carries supply headroom above current demand. The proposed cap sets a ceiling close to the current outstanding balance.
tBTC on Aave V3 Core sits at 70.1% supply cap utilization (1,752 / 2,500). The proposed cap of 1,800 is approximately 1.03x current outstanding supply, landing at approximately 97.3% post-change cap utilization. tBTC supply on this instance has contracted over the trailing thirty days, and the proposed cap follows that trend.
Specification
| Instance | Asset | Current Supply Cap | Recommended Supply Cap | Current Borrow Cap | Recommended Borrow Cap |
|---|---|---|---|---|---|
| Aave V3 Core | tBTC | 2,500 | 1,800 | 1 | - |
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.