StablecoinIRUpdates
01Summary
Proposal to decrease stablecoin borrowing interest rates (Slope1) across Aave V2 and V3 deployments on multiple chains, primarily reducing Slope1 from 12% to 9% for major stablecoins like USDC, USDT, and DAI, while keeping bridged USDC.e 1% higher at 10% to incentivize native USDC borrowing. Changes motivated by MakerDAO's anticipated decrease in DSR from 13% to 10%.
- Type
- parameter change
Key changes
- Decrease Slope1 parameter from 12% to 9% for major stablecoins (USDC, USDT, DAI, FRAX, LUSD, pyUSD, crvUSD, MAI, EURA, EURS, jEUR, sUSD, EURe, WXDAI, FDUSD) across Ethereum V2, Ethereum V3, Avalanche V2/V3, Polygon V3, Optimism V3, Arbitrum V3, Base V3, BNB Chain V3, Scroll V3, and Gnosis V3(high)
- Decrease Slope1 from 13% to 10% for bridged USDC.e on Avalanche V2, Polygon V3, Optimism V3, Arbitrum V3, and Base V3 to maintain 1% premium over native USDC(medium)
- No changes to lower-cap stablecoins on Ethereum V2 (FRAX, sUSD, GUSD, LUSD, USDP) which are being deprecated, and no changes to Metis V3 (m.USDC, m.USDT, m.DAI at 6%)(low)
Notable concerns
- Changes align Slope1 more closely with MakerDAO's DSR reduction to reduce rate arbitrage opportunities
- Previous parameter updates on April 4, 2024 have helped improve rate stability and utilization rates
- Bridged USDC.e assets receive preferential treatment with higher slope to encourage migration to native USDC
Generated by Kvorum
02Description
Simple Summary
A proposal to decrease stablecoin Interest Rate parameters across all Aave deployments.
Motivation
Following the anticipated decrease in DSR—from 13% to 10%—we believe it is prudent to update Aave stablecoin interest rates to best align with the broader market. Previously, we recommended increasing both UOptimal and Slope1 for stablecoins to reduce rate volatility. This recommendation was amended on the news of the DSR increase from 5% to 15%.
The new parameters went into effect on April 4, 2024, and thus far have helped improve rate stability and utilization rates. As part of our ongoing monitoring of broader markets, we note that MakerDAO is in the process of reducing the DAI Savings Rate, which could impact stablecoin rates throughout DeFi.
Following our methodology laid out in previous recommendations , we recommend more closely aligning Slope1 with the DSR to reduce the opportunity of rate arbitrage and ensure that borrow rates remains competitive. As a result, we propose decreasing Slope1 by an equivalent amount from 12% to 9%.
Caveats:
- We do not recommend an update to the following assets on lower-cap stablecoins on Ethereum V2, as they are currently being deprecated.
- Similar to the previous proposals, we recommend bridged USDC.e on all deployments to have a 1% higher slope1 to motivate the borrowing of native USDC.
Specification
| Market | Asset | Current Slope1 | Recommended Slope1 |
|---|---|---|---|
| Ethereum V2 | USDC | 12% | 9% |
| Ethereum V2 | USDT | 12% | 9% |
| Ethereum V2 | DAI | 12% | 9% |
| Ethereum V2 | FRAX | 12% | No Change |
| Ethereum V2 | sUSD | 12% | No Change |
| Ethereum V2 | GUSD | 12% | No Change |
| Ethereum V2 | LUSD | 12% | No Change |
| Ethereum V2 | USDP | 12% | No Change |
| Ethereum V3 | USDC | 12% | 9% |
| Ethereum V3 | USDT | 12% | 9% |
| Ethereum V3 | FRAX | 12% | 9% |
| Ethereum V3 | DAI | 12% | 9% |
| Ethereum V3 | LUSD | 12% | 9% |
| Ethereum V3 | pyUSD | 12% | 9% |
| Ethereum V3 | crvUSD | 12% | 9% |
| Avalanche V2 | USDC.e | 13% | 10% |
| Avalanche V2 | USDT | 12% | 9% |
| Avalanche V2 | DAI | 12% | 9% |
| Avalanche V3 | USDC | 12% | 9% |
| Avalanche V3 | USDT | 12% | 9% |
| Avalanche V3 | DAI | 12% | 9% |
| Avalanche V3 | MAI | 12% | 9% |
| Avalanche V3 | FRAX | 12% | 9% |
| Polygon V3 | USDC | 12% | 9% |
| Polygon V3 | USDT | 12% | 9% |
| Polygon V3 | DAI | 12% | 9% |
| Polygon V3 | MAI | 12% | 9% |
| Polygon V3 | EURA | 12% | 9% |
| Polygon V3 | EURS | 12% | 9% |
| Polygon V3 | jEUR | 12% | 9% |
| Polygon V3 | USDC.e | 13% | 10% |
| Optimism V3 | USDC | 12% | 9% |
| Optimism V3 | USDT | 12% | 9% |
| Optimism V3 | DAI | 12% | 9% |
| Optimism V3 | sUSD | 12% | 9% |
| Optimism V3 | LUSD | 12% | 9% |
| Optimism V3 | MAI | 12% | 9% |
| Optimism V3 | USDC.e | 13% | 10% |
| Arbitrum V3 | USDC | 12% | 9% |
| Arbitrum V3 | USDC.e | 13% | 10% |
| Arbitrum V3 | USDT | 12% | 9% |
| Arbitrum V3 | DAI | 12% | 9% |
| Arbitrum V3 | LUSD | 12% | 9% |
| Arbitrum V3 | FRAX | 12% | 9% |
| Arbitrum V3 | MAI | 12% | 9% |
| Arbitrum V3 | EURS | 12% | 9% |
| Base V3 | USDbC | 13% | 10% |
| Base V3 | USDC | 12% | 9% |
| Metis V3 | m.USDC | 6% | No Change |
| Metis V3 | m.USDT | 6% | No Change |
| Metis V3 | m.DAI | 6% | No Change |
| BNB Chain V3 | USDT | 12% | 9% |
| BNB Chain V3 | USDC | 12% | 9% |
| BNB Chain V3 | FDUSD | 12% | 9% |
| Scroll V3 | USDC | 12% | 9% |
| Gnosis V3 | WXDAI | 12% | 9% |
| Gnosis V3 | USDC | 12% | 9% |
| Gnosis V3 | EURe | 12% | 9% |
References
- Implementation: AaveV2Ethereum, AaveV2Avalanche, AaveV3Ethereum, AaveV3Polygon, AaveV3Avalanche, AaveV3Optimism, AaveV3Arbitrum, AaveV3Base, AaveV3Gnosis, AaveV3Scroll, AaveV3BNB
- Tests: AaveV2Ethereum, AaveV2Avalanche, AaveV3Ethereum, AaveV3Polygon, AaveV3Avalanche, AaveV3Optimism, AaveV3Arbitrum, AaveV3Base, AaveV3Gnosis, AaveV3Scroll, AaveV3BNB
- Snapshot: Direct-to-AIP
- Discussion
Copyright
Copyright and related rights waived via CC0.
03Mismatch analysis
The decoded calldata consists of only two generic execute() fallback calls to two contract addresses on Ethereum mainnet, with no decoded internal parameters. This is the standard pattern for Aave/BGD Labs governance payloads, where a top-level payload contract's execute() function internally performs many granular actions (e.g., calling PoolConfigurator/RiskSteward functions to set Slope1 on numerous reserves) and, for other networks, forwards messages via Aave's cross-chain governance bridge (CrossChainController). The description's detailed table spans 12+ deployments across many chains, which is consistent with this architecture: a small number of mainnet execute() calls fanning out to many sub-actions and cross-chain messages, matching the referenced per-network implementation contracts (AaveV2Ethereum, AaveV3Polygon, AaveV3Avalanche, etc.). Because the decoded calldata provides no visibility into the internal logic of these execute() calls (no per-asset parameter values, no target reserve addresses, no cross-chain message contents), it is not possible to verify at a granular level whether each specific Slope1 change (12%->9%, 13%->10%, or 'No Change') actually matches what is described. However, nothing in the available decoded data contradicts the description, and the overall structure (few top-level mainnet actions triggering a broader payload) is exactly what is expected for this type of routine, well-documented Aave IR update proposal with public, verifiable implementation and test source code referenced. Given the opacity of the decoded actions, confidence in this comparison is low, but there is no evidence of a mismatch, so the assessment is recorded as consistent rather than flagging unverifiable claims as discrepancies.
Generated by Kvorum
04Actions
- Target
- 0x26c0…13ac
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
- Target
- 0x41d6…23a9
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
05Tally
Summed from votes
06Voters
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07Forum
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