[Temp Check] Aave’s CDP for Uniswap V4 Positions

Governance
1

Simple Summary

Aave Labs proposes introducing a specialized Uniswap V4 Position Manager that enables suppliers of Uniswap V4 liquidity to open collateralized debt positions (CDPs) within the Aave ecosystem and borrow GHO against their LP shares.

The module applies Aave’s existing risk parameters and oracle feeds, while preserving Uniswap V4’s hook-based liquidity design. Once Aave V4’s Liquidity Hub is live, the Position Manager will extend borrowing to additional stablecoin and volatile assets.

A complete technical specification, development timeline, and revenue model are presented in the Request-for-Comment currently active in the Uniswap governance forum. This thread invites the Aave community to share initial feedback and to review the external RFC for deeper context. A subsequent proposal would seek the activation of a GHO facilitator bucket and outline operational considerations.

Motivation

Leveraging the complementary architectures of Uniswap V4 and the forthcoming Aave V4, the proposed Position Manager unlocks three strategic advantages for the Aave ecosystem:

  1. Capital-efficient borrowing for LPs: Uniswap V4 suppliers can immediately mint GHO (and later other assets) against their onchain LP shares, amplifying capital efficiency without fragmenting Aave liquidity.
  2. New protocol revenue streams: A built-in profit-sharing model routes a percentage of GHO-borrow yield from these CDPs back to the Uniswap fee collector and to the Aave Treasury, aligning incentives across both DAOs.
  3. Strengthened cross-protocol leadership: By pairing Aave’s risk-tested collateral framework with Uniswap’s concentrated liquidity design, the integration reinforces both protocols’ positions as market standards while expanding user adoption for GHO.
  4. Seamless integration with existing risk framework: The Position Manager inherits Aave’s risk parameters. Therefore, the design introduces no additional workload for Aave DAO risk contributors.

Specification

Development, security reviews, and ongoing maintenance of the Uniswap V4 Position Manager are covered by a grant that Aave Labs is asking the Uniswap DAO to allocate. This proposal therefore introduces no direct expenditure for the Aave DAO.

Revenue flow to the Aave Protocol begins once the Position Manager is live with a GHO Facilitator bucket. While 50 percent of net GHO-borrow interest is routed to the Uniswap fee-collector address, the remainder follows Aave’s standard reserve-factor mechanics.

To activate this implementation, Aave governance is asked to allocate an initial GHO Facilitator bucket sized to community risk appetite and expand it over time as utilisation warrants.

Disclaimer

Aave Labs is not directly affiliated with the Uniswap Foundation, the Uniswap Labs, or any other Uniswap interested party, and has not been compensated by any third party for creating this proposal.

Next Steps

  1. Engage with the community and service providers to refine the detailed proposal
  2. If consensus is reached on this TEMP, escalate this proposal to the Snapshot stage
  3. If the TEMP snapshot outcome is YAE, incorporate stakeholder feedback and move proposal to ARFC stage

Copyright

Copyright and related rights waived via CC0.

7 Likes
2

Excited about this proposal and the opportunity for both Aave and Uniswap. Looking at the revenue share projections, even in the case that 10% of TVL is captured (conservatively), Aave can earn $4.5M in revenue - and this is likely to increase over time. There is a clear need to match up to the likes of Fluid, who have transformed the DEX/Lending & Borrowing landscape, and generate capital efficiency from passive LP positions. The primary aspects to be ironed out seem to be on the revenue sharing and budgeting side and this may be a proposal that takes some time to be discussed within both DAOs before full alignment is found. However, the potential is huge both now and in the future.

1 Like