Add USDT to Aave Ethereum V3 pool
01Summary
Aave governance proposal to add USDT to the Ethereum v3 Liquidity Pool as a non-collateral, borrowable asset with a 200M supply cap and 185M borrow cap, using the same interest rate strategy as USDT in V2.
- Type
- protocol addition
Key changes
- USDT onboarded to Aave Ethereum v3 as a borrowable, non-collateral asset(high)
- USDT configured with 200M supply cap and 185M borrow cap to limit risk exposure(high)
- Interest rate strategy applied: 0% base, 4% slope1, 72% slope2, with 90% optimal utilization(medium)
- Reserve factor set to 10% with 10% liquidation protocol fee(medium)
- USDT enabled for flash loans but not for isolation mode, emode, or stable rate mode(low)
Notable concerns
- USDT cannot be used as collateral due to 0 LTV
- No USD stablecoin eMode enabled due to V3 maturity concerns
- Supply and borrow caps implemented to limit risk exposure
- Deployment payload reviewed by Bored Ghost Developing
Generated by Kvorum
02Description
Simple Summary
This AIP proposal presents Aave with the opportunity to onboard USDT to the Ethereum v3 Liquidity Pool.
Motivation
Supporting stablecoin diversity is part of the Aave-Chan Initiative (ACI) delegate platform.
The ACI does not have any link nor is paid by Tether or any entity to present this ARC.
The risk parameters provided introduce USDT as a non-collateral asset.
The Interest rate Strategy curve is the same as for USDT in V2. for now. The ACI is supportive of onboarding USDT as it was in V2. For now, the ACI doesn’t consider V3 mature enough to activate a USD stablecoins emode and consider USDT in it. Also, supply and borrow caps are suggested for this asset to limit risk exposure.
Specification
Ticker: USDT
Contract Address: 0xdAC17F958D2ee523a2206206994597C13D831ec7
| Risk Parameter | Value |
|---|---|
| Isolation Mode | NO |
| Enable Borrow | YES |
| Enable Collateral | NO |
| Loan To Value | N/A |
| Liquidation Threshold | N/A |
| Liquidation Bonus | N/A |
| Reserve Factor | 10% |
| Liquidation Protocol Fee | 10% |
| Borrow Cap | 185M |
| Supply Cap | 200M |
| Debt Ceiling | N/A |
| Base | 0% |
| Slope1 | 4% |
| Uoptimal | 90% |
| Slope2 | 72% |
The proposal payload uses the GenericListingEngine to perform a new asset listing with the following parameters:
IGenericV3ListingEngine.Listing({
asset: USDT,
assetSymbol: 'USDT',
priceFeed: USDT_USD_FEED,
rateStrategy: 0xdd1BAC6A713c5b0EC42bA39D0c5e4582975DE6D6,
enabledToBorrow: true,
stableRateModeEnabled: false,
borrowableInIsolation: false,
withSiloedBorrowing: false,
flashloanable: true,
ltv: 0,
liqThreshold: 0,
liqBonus: 0,
reserveFactor: 10_00,
supplyCap: 200_000_000,
borrowCap: 185_000_000,
debtCeiling: 0,
liqProtocolFee: 10_00,
eModeCategory: 0
});
References
A list of relevant links like for this proposal e.g.
Security Considerations
The proposal Payload was reviewed byBored Ghost Developing.
Deployed Contracts
Copyright
Copyright and related rights waived via CC0.
03Mismatch analysis
The proposal's on-chain footprint consists of a single delegatecall-style execute() invocation on the payload contract address that is explicitly named in the 'Deployed Contracts' section of the description. This matches the standard Aave governance pattern where all listing logic (asset onboarding, risk parameters, interest rate strategy) is encapsulated in a pre-audited, immutable payload contract rather than being decoded as discrete calldata parameters in the proposal action itself. Since the calldata only shows the entry-point call and not the internal listing parameters, I cannot directly verify the numeric risk parameters (LTV, caps, reserve factor, rate curve) against the decoded action, but the target address matches the one disclosed and linked (with source code and tests) in the description, and this pattern is standard/expected for Aave AIPs reviewed by BGD Labs. No mismatched targets, values, or omitted/extra actions are evident at the level the calldata exposes. Confidence is medium rather than high because the single opaque execute() call limits independent verification of the detailed parameters claimed in the prose, but there is no indication of any inconsistency, hidden action, or misleading phrasing.
Generated by Kvorum
04Actions
- Target
- 0x3b45…facb
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
05Tally
Summed from votes
06Voters
No votes recorded yet.
07Forum
- [ARFC] Add USDT to Ethereum V3 Market ↗discourse · high confidence
Arguments for
- Onboarding USDT fills a liquidity gap and repairs important relationships with Balancer, aiding V3 usability.— fig
- USDT is one of the largest and most liquid stablecoins that has proven resilient and solvent through multiple market stress events.— JesusCryptoPlaza
- USDT supports stablecoin diversity, aligns with ACI's platform, and is being added conservatively as a non-collateral, borrow-only asset with supply/borrow caps to limit risk.— MarcZeller
- Risk management teams reviewed and support the proposed parameters given USDT's non-collateral status in this listing.— ChaosLabs, Pauljlei
- Slightly more attractive parameters (e.g., higher Uoptimal) on V3 versus V2 could encourage user migration from V2 to V3.— MarcZeller
- Llama and other contributors support an accelerated governance process to expedite listing USDT alongside other strategic assets.— Llamaxyz, ChaosLabs
Arguments against
None surfaced.
Unresolved concerns
- The proposed 185M borrow cap seems excessive relative to the current ~70M pool size, especially compared to more conservative caps used on other Aave V3 deployments (e.g., Avalanche).— sakulstra
- Discrepancy between the proposed Uoptimal (90%) and the current V2 Uoptimal (80%) was questioned, though MarcZeller framed the higher V3 value as intentional to encourage migration rather than an error to fix.— GCao
Notable participants
- MarcZellerProposer from the Aave-Chan Initiative who authored the ARFC, defended risk parameters, and managed the escalation to Snapshot vote.
- LlamaxyzCo-author of the proposal who pushed for an accelerated listing process and also advocated for parallel fast-tracking of BAL and CRV.
- ChaosLabsRisk service provider that reviewed and endorsed the proposed non-collateral parameters and supported the expedited process.
- sakulstraRaised a specific technical concern about the borrow cap being disproportionately high relative to pool size.
- figCommunity member who voiced support, framing the listing as solving a liquidity gap and repairing Balancer relations.
- JesusCryptoPlazaRepresented Crypto Plaza in fully supporting USDT onboarding, citing its market resilience and liquidity role.
- PauljleiRepresented Gauntlet, confirming no objections to the proposed risk parameters.
- GCaoRepresented Michigan Blockchain, supported the proposal while questioning a parameter discrepancy with V2.
Generated by Kvorum
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