Increase Borrow Slope1 to all Stablecoins across all Aave Instances
01Summary
This proposal increases the borrow slope1 parameter (the first segment of the interest rate curve) for stablecoins to 12.5% across Aave V2 Ethereum and all Aave V3 instances (Ethereum, Avalanche, Polygon, Optimism, Arbitrum, Base, Metis, BNB Chain, Scroll, Gnosis, and ZkSync). Some assets with different current rates (like USDC.e, USDbC, and GHO) are increased to 13.5% or adjusted according to their specific current rates. The proposal also adjusts slope2 parameters for V3 instances. The goal is to optimize interest rates to reflect current market conditions, increase protocol revenue,
- Type
- parameter change
Key changes
- Increase borrow slope1 for stablecoins (USDC, USDT, DAI, USDe, FRAX, LUSD, PYUSD, crvUSD, EURS, sUSD, GHO, WXDAI, EURe, and others) from current rates (primarily 5.5%, with some assets at 6.0%-10%) to 12.5% across all Aave V3 instances and Aave V2 on Ethereum(high)
- Adjust slope1 for certain wrapped stablecoins (USDC.e on Polygon, Optimism, Arbitrum, Gnosis; USDbC on Base) to 13.5% from current rates of 9%-10%(high)
- Introduce slope2 parameters for Aave V3 instances where they were previously not specified, setting them to values ranging from 35%-50% depending on the asset and market(medium)
- Modify slope2 values for Aave V3 Core and other instances to specific percentages (e.g., USDC slope2 from 75% to 35% on Ethereum V3 Core)(medium)
Notable concerns
- This is a broad, multi-chain parameter change affecting stablecoins across 11+ blockchain instances and 2 Aave versions simultaneously
- The increase of slope1 by 127% (from 5.5% to 12.5%) significantly raises borrowing costs for stablecoins, which could reduce demand for stablecoin borrows if users migrate to other protocols
- The proposal relies on the assumption that higher utilization in stablecoin markets will persist, which may not hold if market conditions change
- Some assets have differential treatment (wrapped stablecoins at 13.5%), which could create rate disparities and incentivize certain market segments
Generated by Kvorum
02Description
Simple Summary
This proposal recommends increasing the borrow slope1 parameter for stablecoins across all Aave V3 Instances and Aave V2 on mainnet to 12.5%. This adjustment aims to align interest rate models with the updated Stable Debt Reserve (SDR) strategy, promoting sustainability, better risk management, and optimal utilization of the protocol’s resources.
Motivation
The current market environment presents a unique opportunity to optimize Aave’s interest rate parameters. With the introduction of sUSDe as E-Mode collateral and general market sentiment leading to higher desire for borrowing, we are seeing significantly higher utilisation in the stablecoin market. This adjustment to the borrow slope1 will better align Aave’s interest rates with prevailing market conditions, potentially leading to:
- Increased protocol revenue through better rate optimization
- Enhanced capital efficiency by maintaining competitive lending rates at lower volatility.
Additionally, this change will ensure appropriate risk compensation for stablecoin lenders.
Specification
| Market | Asset | Current Slope1 | Recommended Slope1 | Current Slope2 | Recommended Slope2 |
|---|---|---|---|---|---|
| Ethereum V2 | USDC | 5.5% | 12.5% | 60% | - |
| Ethereum V2 | USDT | 5.5% | 12.5% | 100% | - |
| Ethereum V2 | DAI | 5.5% | 12.5% | 75% | - |
| Ethereum V3 Core | USDC | 5.5% | 12.5% | 75% | 35% |
| Ethereum V3 Core | USDT | 5.5% | 12.5% | 75% | 35% |
| Ethereum V3 Core | USDe | 9.0% | 12.5% | 75% | 50% |
| Ethereum V3 Core | FRAX | 5.5% | 12.5% | 75% | 40% |
| Ethereum V3 Core | DAI | 5.5% | 12.5% | 75% | 35% |
| Ethereum V3 Core | LUSD | 5.5% | 12.5% | 87% | 50% |
| Ethereum V3 Core | PYUSD | 5.5% | 12.5% | 80% | 50% |
| Ethereum V3 Core | crvUSD | 5.5% | 12.5% | 80% | 50% |
| Ethereum V3 Prime | USDC | 5.5% | 12.5% | 60% | 35% |
| Ethereum V3 EtherFi | USDC | 6.5% | 12.5% | 60% | 40% |
| Ethereum V3 EtherFi | PYUSD | 5.5% | 12.5% | 80% | 40% |
| Ethereum V3 EtherFi | FRAX | 5.5% | 12.5% | 80% | 40% |
| Avalanche V3 | USDC | 5.5% | 12.5% | 60% | 40% |
| Avalanche V3 | USDT | 5.5% | 12.5% | 75% | 40% |
| Avalanche V3 | DAI | 5.5% | 12.5% | 75% | 40% |
| Avalanche V3 | FRAX | 5.5% | 12.5% | 75% | 40% |
| Polygon V3 | USDC | 5.5% | 12.5% | 60% | 40% |
| Polygon V3 | USDC.e | 10.0% | 13.5% | 80% | 40% |
| Polygon V3 | USDT | 5.5% | 12.5% | 75% | 40% |
| Polygon V3 | DAI | 5.5% | 12.5% | 75% | 40% |
| Polygon V3 | EURS | 5.5% | 12.5% | 75% | 50% |
| Optimism V3 | USDC | 5.5% | 12.5% | 60% | 40% |
| Optimism V3 | USDT | 5.5% | 12.5% | 75% | 40% |
| Optimism V3 | DAI | 5.5% | 12.5% | 75% | 40% |
| Optimism V3 | sUSD | 5.5% | 12.5% | 75% | 50% |
| Optimism V3 | LUSD | 5.5% | 12.5% | 87% | 50% |
| Optimism V3 | USDC.e | 6.5% | 13.5% | 80% | 40% |
| Arbitrum V3 | USDC | 5.5% | 12.5% | 60% | 40% |
| Arbitrum V3 | USDC.e | 6.5% | 13.5% | 80% | 40% |
| Arbitrum V3 | USDT | 5.5% | 12.5% | 75% | 40% |
| Arbitrum V3 | DAI | 5.5% | 12.5% | 75% | 40% |
| Arbitrum V3 | LUSD | 5.5% | 12.5% | 87% | 50% |
| Arbitrum V3 | FRAX | 5.5% | 12.5% | 75% | 40% |
| Arbitrum V3 | GHO | 12% | 12.5% | 65% | 40% |
| Base V3 | USDC | 5.5% | 12.5% | 60% | 40% |
| Base V3 | USDbC | 10.0% | 13.5% | 80% | 40% |
| Metis V3 | m.USDC | 6.0% | 12.5% | 60% | 40% |
| Metis V3 | m.USDT | 6.0% | 12.5% | 75% | 40% |
| Metis V3 | m.DAI | 7.0% | 12.5% | 75% | 50% |
| BNB Chain V3 | USDT | 5.5% | 12.5% | 75% | 40% |
| BNB Chain V3 | USDC | 5.5% | 12.5% | 60% | 40% |
| BNB Chain V3 | FDUSD | 5.5% | 12.5% | 75% | 40% |
| Scroll V3 | USDC | 5.5% | 12.5% | 60% | 40% |
| Gnosis V3 | WXDAI | 5.5% | 12.5% | 75% | 40% |
| Gnosis V3 | USDC | 5.5% | 12.5% | 75% | 40% |
| Gnosis V3 | EURe | 5.5% | 12.5% | 75% | 50% |
| Gnosis V3 | USDC.e | 9% | 13.5% | 75% | 40% |
| ZKSync V3 | USDC | 5.5% | 12.5% | 60% | 40% |
| ZKSync V3 | USDT | 5.5% | 12.5% | 60% | 40% |
References
- Implementation: AaveV2Ethereum, AaveV3Ethereum, AaveV3EthereumLido, AaveV3EthereumEtherFi, AaveV3Polygon, AaveV3Avalanche, AaveV3Optimism, AaveV3Arbitrum, AaveV3Metis, AaveV3Base, AaveV3Gnosis, AaveV3Scroll, AaveV3BNB, AaveV3ZkSync
- Tests: AaveV2Ethereum, AaveV3Ethereum, AaveV3EthereumLido, AaveV3EthereumEtherFi, AaveV3Polygon, AaveV3Avalanche, AaveV3Optimism, AaveV3Arbitrum, AaveV3Metis, AaveV3Base, AaveV3Gnosis, AaveV3Scroll, AaveV3BNB, AaveV3ZkSync
- Snapshot: Direct-to-AIP
- Discussion
Copyright
Copyright and related rights waived via CC0.
03Mismatch analysis
The proposal description contains a very detailed table specifying exact slope1/slope2 interest-rate parameter changes for dozens of stablecoin reserves across 15+ Aave V2/V3 deployments on multiple chains. However, the decoded on-chain calldata only shows four generic execute() (fallback) calls to four distinct mainnet contract addresses, with no decoded function arguments. This is the typical pattern for Aave cross-chain governance, where the top-level AIP payload dispatches to per-network 'payload' contracts (matching the linked GitHub implementation files) that internally encode the specific rate parameter updates via delegatecall; the actual per-asset slope changes are not visible in this top-level decoded calldata. Because the calldata gives no visibility into the specific numeric parameters being set, it is not possible to directly verify or refute the specific percentages and market targets claimed in the description (e.g., 12.5% vs 13.5% slope1, or the various slope2 reductions). There is no evidence of a mismatch — the number of distinct target contracts (4, likely corresponding to grouped ecosystem reserves factories/payloads bundling multiple chain-specific executions or a subset of the referenced repos) is plausible given the proposal's multi-chain scope — but without deeper introspection into the called payload contracts' internal logic, a full one-to-one verification of every table row against calldata cannot be performed. Given this opacity, confidence is set to low and no specific value/target discrepancies are flagged, since doing so would require speculation beyond the provided decoded data. Nothing in the visible calldata contradicts the description, and no unexpected actions (transfers, role grants, etc.) are apparent beyond the expected governance execution pattern.
Generated by Kvorum
04Actions
- Target
- 0xc2c6…ae17
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
- Target
- 0xd8c8…fbc5
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
- Target
- 0x772c…ca44
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
- Target
- 0xe5a0…887e
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
05Tally
Summed from votes
06Voters
No votes recorded yet.
07Forum
No forum thread is confidently linked to this proposal.
08Similar proposals
- aaveexecutedDecrease Slope1 Parameter for Stablecoins on Aave V394%
- aaveexecutedStablecoins Interest Rate Curve Update91%
- aaveexecutedStablecoinIRUpdates89%
- aaveexecutedIncrease Stablecoin Optimal Borrow Rates89%
- aaveexecutedStablecoin IR Curve Amendment89%
- aaveexecutedStablecoin IR Curve Amendment89%
- aaveexecutedStablecoin IR Curves Updates87%
- aaveexecutedStablecoinIRUpdates86%
- aaveexecutedConfiguration maintenance85%
- aaveexecutedGeneralized LT/LTV Reduction on Aave84%