Aave is moving to deprecate dozens of low activity asset reserves and shut down six blockchain deployments as part of a broad effort to reduce the lending protocol’s economic and technical risk.
Aave founder Stani Kulechov said the protocol will deprecate 50 low adoption reserves across several deployments. It will also orderly wind down its markets on Sonic, Scroll, zkSync, Metis, Soneium, and Aptos, covering another 25 reserves.
The process also includes 21 matured Pendle Principal Tokens that will be replaced by reserves linked to newer maturities.
Together, the changes affect approximately $98.1 million in supplied assets and $15.6 million in outstanding debt.
“These measures reduce Aave’s economic and technical risk surface as part of the new Aave Risk Framework and Technical Asset Listing Framework,” Kulechov said.
The recommendations were prepared by DeFi risk service provider LlamaRisk alongside other Aave service providers working on reducing the protocol’s risk surface.
According to the review, the individual reserve removals cover $85.3 million in supply and $11.5 million in debt. The six complete market closures account for another $12.8 million in supply and $4.1 million in debt.
Aave targets reserves with limited activity
Most of the assets included in the proposal have either remained below Aave’s required usage thresholds or experienced substantial declines in deposits.
Each reserve creates ongoing operational requirements for the protocol, including maintaining price oracles, monitoring risk parameters, and ensuring that liquidations can be completed reliably.
LlamaRisk said reserves whose activity no longer justifies those costs should be wound down rather than maintained indefinitely.
The scope also includes bridged assets such as USDC.e and USDbC in markets where native USDC is already available. Other special cases include MaticX, which is being discontinued by its issuer, and matured Pendle tokens that no longer generate yield.
Some of the largest individual positions include $32.2 million held in matured Pendle tokens on Plasma, $11.1 million in FBTC on Ethereum, and $5.3 million in eBTC.
Aave is also targeting assets such as DAI on Arbitrum, USDC.e on Polygon, WBTC.e on Avalanche, and several smaller reserves across Ethereum, Base, Optimism, Gnosis, BNB Chain, and MegaETH.
Six Aave deployments will be retired
The six complete market closures were selected after activity and protocol revenue declined below levels needed to justify their maintenance costs.
Deposits on Aave’s Sonic deployment fell 74% over six months to $7.6 million, while the Scroll market declined 86% to $2.2 million.
Deposits on zkSync dropped 88% to approximately $844,000. Metis declined 79% to $297,000, while Soneium deposits fell 95% to $173,000.
Aptos currently holds around $1.7 million in supplied assets and $719,000 in debt. Available liquidity across its reserves has fallen approximately 94% over six months.
LlamaRisk estimated that Sonic, Scroll, and zkSync each generate less than $5,000 in protocol revenue per quarter at current balances. Metis, Soneium, and Aptos generate less than $1,000 per quarter.
The review concluded that this revenue does not cover the costs of maintaining price feeds, monitoring risks, and providing operational support for the deployments.
Users will be given time to exit positions
Aave plans to wind down the affected reserves gradually rather than immediately closing user positions.
The standard process involves freezing each reserve and reducing its supply and borrowing caps to one. Freezing prevents users from creating new deposits, loans, or collateral positions while allowing existing positions to remain open.
For reserves with outstanding loans, Aave may increase the reserve factor, directing a larger share of interest payments to the protocol treasury and reducing returns for depositors. The measure is designed to encourage suppliers to withdraw and borrowers to repay.
For the six complete market closures, reserves with outstanding debt will generally have their reserve factor increased to 99%, while the base borrowing rate will be set at 5%.
Aave may later raise borrowing rates further or gradually reduce liquidation thresholds where borrowers do not unwind their positions.
Once the remaining exposure has declined, the protocol plans to replace live price feeds on the retired deployments with fixed price oracles, allowing the markets to be fully discontinued.
Kulechov said Aave will continue conducting continuous risk assessments for assets across all its deployments.