Finally. As a serious allocator we can say there is still too much crap on collaterals.
Offchain capital comes with a mandate, and a mandate needs an exposure it can name. A pooled market where $800M of WETH is borrowed against rsETH, or any serial rugger / low quality team that gets a listing, does not give one. Even onchain native money is finally more conservative than it used to be, and isnโt chasing points.
Happy to build HOT7 on
@aave and we thank all the Hot spies out there for the exceptional fills.
Built on
@base and
@HyperliquidX. Coinbase stock tokens in the V4 Equities Hub, where USDC is the only borrow, perps short against them. The NVDA card is the hedge leg (the long leg is the Aave screen above it).
Funny that French KOL
@Cbb0fe recommends now what we have been doing for over a year at this point (perp leg since xyz day one). Probably why the best art in France is the Gioconda, painted by an Italian KEK ๐
Stani, ship it.
LlamaRisk proposes repositioning Aave V3 Core, Aave's largest market, to focus on liquid, blue-chip collateral.
The proposal would remove several categories of exposure:
1. Restaking assets
2. Leveraged wrapping strategies
3. Issuers whose operational and security resources fall short of Aave's risk standards
4. Low-demand reserves that no longer justify ongoing maintenance
This means potentially moving $1.52B in collateral backing $1.17B in debt out of V3 Core in favour of blue-chip collateral.
As the risk landscape evolves and Aave V4 grows, the goal is to sharpen V3 Core's risk profile and raise the bar for collateral eligibility.
Some affected assets could transition to isolated Aave V4 markets, where more granular risk controls allow for better risk-reward alignment.
The proposal comes from LlamaRisk, an Aave Protocol Risk Manager, and remains subject to governance discussions and engagement with asset issuers.
Aave will continue applying continuous risk assessment for all assets across all deployments.
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