increase supply cap for cbETH Aave Ethereum V3
01Summary
Proposal to increase the cbETH supply cap on Aave Ethereum v3 Liquidity Pool from 20,000 to 30,000 cbETH tokens to support LSD diversity, with risk parameters proposed by Gauntlet and Chaos Labs.
- Type
- parameter change
Key changes
- Increase cbETH supply cap from 20,000 to 30,000 tokens on Aave Ethereum v3(high)
Notable concerns
- Proposal lacks clear specification of risk assessment methodology beyond mentions of Gauntlet and Chaos Labs collaboration
Generated by Kvorum
02Description
Simple Summary
This AIP proposal presents Aave with the opportunity to increase cbETH supply cap on the Ethereum v3 Liquidity Pool.
Motivation
Supporting LSDs diversity is part of the Aave-Chan Initiative (ACI) delegate platform.
The ACI does not have any link nor is paid by Coinbase or any entity to present this AIP.
Supply cap is suggested for this asset to limit risk exposure, the caps have been proposed by a join collaboration between Gauntlet & Chaos Labs.
Specification
Ticker: cbETH
Contract Address: 0xbe9895146f7af43049ca1c1ae358b0541ea49704
| Risk Parameter | Current Value | Proposed Value |
|---|---|---|
| Supply Cap | 20K | 30K |
contract AaveV3EthCbETHCapsPayload is IProposalGenericExecutor {
address public constant CBETH = AaveV3EthereumAssets.cbETH_UNDERLYING;
uint256 public constant CBETH_SUPPLY_CAP = 30_000;
function execute() external {
IPoolConfigurator configurator = AaveV3Ethereum.POOL_CONFIGURATOR;
configurator.setSupplyCap(CBETH, CBETH_SUPPLY_CAP);
}
}
References
A list of relevant links like for this proposal e.g.
Security Considerations
The proposal Payload was reviewed by Bored Ghost Developing.
Copyright
Copyright and related rights waived via CC0.
03Mismatch analysis
The proposal follows the standard Aave governance pattern: the on-chain action is a single delegatecall-style execute() invocation on a dedicated payload contract, and the actual parameter change (setSupplyCap) is embedded in that contract's bytecode rather than visible as explicit calldata arguments. The description includes the full Solidity source of the payload contract, which clearly shows CBETH_SUPPLY_CAP = 30_000 being applied via configurator.setSupplyCap(CBETH, CBETH_SUPPLY_CAP). This matches the prose claim of raising the cbETH supply cap from 20K to 30K. Since the decoded action list only shows the outer execute() call (as is typical for Aave AIPs where the payload logic isn't separately decoded), I cannot independently verify the internal call from the JSON alone, which lowers confidence to medium, but there is no evidence of any mismatch — target contract, function name, and asset align with the description. No numeric, target, or scope discrepancies were found, and no additional undisclosed actions appear in the calldata beyond the single expected execute() call. Given the well-known convention for these proposals and the matching provided source code, I classify this as consistent, with medium confidence due to the limited decoding depth of the calldata provided.
Generated by Kvorum
04Actions
- Target
- 0xb6e5…cc83
- Value
- 0 wei
- Function
- fallback()
- Arguments
{}- Calldata
05Tally
Summed from votes
06Voters
| Voter | Choice | % of total | Rationale | ||
|---|---|---|---|---|---|
| 320x329c…3ed4 | For | 222.8K | 0.00% | — | 4y ago |
| 620x62a4…816a | For | 81.6K | 0.00% | — | 4y ago |
| 130x13bd…8548 | Against | 80.6K | 0.00% | — | 4y ago |
| B80xb83b…cf5c | Against | 80.2K | 0.00% | — | 4y ago |
| EA0xea17…6676 | For | 10.6K | 0.00% | — | 4y ago |
| 5F0x5fa0…cfa8 | Against | 500.1 | 0.00% | — | 4y ago |
| 210x2155…59aa | For | 9.2 | 0.00% | — | 4y ago |
| A00xa0ef…2d56 | For | 8.3 | 0.00% | — | 4y ago |
| 090x09e3…23cd | For | 1 | 0.00% | — | 4y ago |
| 340x345f…12bf | For | 1 | 0.00% | — | 4y ago |
| 360x3647…a20e | For | 0.8 | 0.00% | — | 4y ago |
| E40xe459…e666 | Against | 0.5 | 0.00% | — | 4y ago |
| 7C0x7c45…6af8 | For | 0.2 | 0.00% | — | 4y ago |
| 050x05f7…946c | For | 0.2 | 0.00% | — | 4y ago |
| F20xf279…bab2 | For | 0.1 | 0.00% | — | 4y ago |
| 3E0x3e07…525b | For | 0.1 | 0.00% | — | 4y ago |
| AF0xaf60…9b92 | For | 0 | 0.00% | — | 4y ago |
| 290x29bc…d91d | For | 0 | 0.00% | — | 4y ago |
07Forum
- [ARFC] increase supply cap for cbETH Aave Ethereum V3 ↗discourse · high confidence
Arguments for
- cbETH is near/at its supply cap, indicating strong market demand that an increase would accommodate, allowing new and existing users to grow positions.— MarcZeller
- Chaos Labs' market risk methodology supports raising the supply cap to 20k with no change to the borrow cap.— ChaosLabs
- Gauntlet's modeling shows cbETH would need roughly a 25% price deviation before debt becomes insolvent, supporting a 20k cap.— Pauljlei
- LSDs like cbETH are strategic assets for Aave V3 (especially for future emode), and the proposed cap balances conservatism with allowing growth so Aave doesn't lose demand to other protocols.— MarcZeller
- Regulatory/depeg risk from a potential SEC action against Coinbase is considered low and manageable, comparable to the BUSD precedent, with the ACI ready to support freezing the reserve if needed.— MarcZeller
Arguments against
- If emode is enabled for cbETH before the new cap is reached, the asset's risk profile could change, so a more conservative community might prefer a smaller increase (e.g., to 15k) rather than the full 20k.— Pauljlei
- Given uncertainty over the Shanghai upgrade timing and unclear regulatory status of Coinbase's products, it might be prudent to delay the cap increase until there is more clarity.— lbsblockchain
Unresolved concerns
- Uncertainty remains about whether and when the Shanghai upgrade will occur and how that affects withdrawal queue length and depeg risk, despite MarcZeller's optimistic projection.— lbsblockchain
- The interaction between a future cbETH emode addition and the current supply cap's risk profile has not been fully resolved and is deferred to a later proposal.— Pauljlei, MarcZeller
- The regulatory risk of a potential SEC action against Coinbase impacting cbETH's peg is acknowledged but not formally mitigated beyond informal assurances.— lbsblockchain, MarcZeller
Notable participants
- MarcZellerProposer from Aave Chan Initiative who authored the ARFC and responded to community questions defending the cap increase and regulatory risk assessment.
- ChaosLabsRisk service provider that reviewed the proposal and endorsed the 20k supply cap based on market risk methodology.
- PauljleiGauntlet representative who provided risk modeling supporting the cap increase while flagging a caution about future emode interactions.
- lbsblockchainCommunity member who raised critical questions about depeg risk, regulatory uncertainty, and the Shanghai upgrade timing.
Generated by Kvorum
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