Aave, one of the largest decentralized finance (DeFi) lending protocols, is moving forward with a governance proposal that would wind down its V3 markets on six blockchains and retire dozens of low-use token listings. The cleanup, first outlined by risk management service LlamaRisk, targets $98.1 million in supplied assets and $15.6 million in debt across the affected deployments. It represents a significant recalibration of Aave's multichain expansion as the protocol seeks to reduce economic and technical risk.
The proposal, published as an Aave Request for Comment (ARFC), recommends offboarding 50 low-use reserves and 21 matured Pendle principal token listings across 11 deployments. In addition, LlamaRisk recommended retiring all 25 reserves on Sonic, Scroll, zkSync, Metis, Soneium, and Aptos. The balances were measured on July 28, providing a snapshot of the underperforming markets that Aave now intends to deprecate systematically.
An ARFC is a detailed proposal and precursor to an Aave Improvement Proposal (AIP); it is not, by itself, proof of a completed final onchain vote or execution. Community members can still submit feedback, and the proposal may be adjusted before a formal AIP is presented for a vote. However, the fact that LlamaRisk and other Aave service providers have jointly formulated the recommendation signals a high likelihood that the cleanup will proceed in some form.
Aptos exit follows recent launch
Among the most notable recommendations is the proposed full exit from Aptos, a blockchain that only joined the Aave ecosystem 11 months before the publication of this proposal. According to LlamaRisk, available liquidity on the Aptos V3 market has dropped 94% over the past six months, and quarterly revenue is now below $1,000. The sharp decline in activity made the market unsustainable, especially when compared to the operational and security costs of maintaining a dedicated deployment.
The situation on other chains is slightly different but equally dire. Every reserve on Scroll, zkSync, Metis, and Soneium was already frozen prior to this proposal, meaning that users could not initiate new borrows or supply additional collateral on those instances. Sonic and Aptos, by contrast, remained active and are now being recommended for freezing. If the proposal passes, all six chains will see their V3 markets fully wound down, with users expected to repay outstanding debt and withdraw their supplied assets before the final shutdown.
The push to deprecate these underperforming instances follows a temp check concluded on Dec. 5, 2025, where Aave’s multichain strategy was put to a community vote. According to the official record, 923,400 votes were cast in favor and less than 1% were against. The approved measures included increasing the reserve factor on underperforming instances, shutting down the instances on zkSync, Metis, and Soneium, and establishing a $2 million annual revenue floor for any new instance deployment. This floor is designed to ensure that Aave only expands to blockchains that can generate meaningful economic activity.
Scroll was added to the list of affected protocols through an accelerated process in April. LlamaRisk filed a direct-to-AIP proposal to freeze every Scroll reserve and raise selected reserve factors, describing the measure as completing Scroll’s deprecation after a rapid deterioration in network liquidity and Aave market activity. That move set a precedent for how Aave handles chains that fail to meet minimum viability thresholds.
New risk framework drives the cleanup
The current offboarding proposal is not an isolated action. Aave published an updated risk framework on June 9, covering asset, bridge, monitoring, and chain risk, along with clear criteria for winding down reserves or entire deployments. The framework establishes quantitative and qualitative thresholds that every integrated chain and asset must meet to remain on the protocol. The July announcement indicates de facto adoption of those rules by the protocol, as the affected markets have failed to demonstrate sustained usage or revenue generation.
Aave founder Stani Kulechov commented on the development in a Thursday post on X, emphasizing that this initiative will also “reduce Aave’s economic and technical risk surface as part of the new Aave Risk Framework and Technical Asset Listing Framework.” His statement suggests that the proposal is not merely reactive but part of a broader strategy to professionalize risk management across all Aave deployments.
Kulechov was quick to clarify that this is not a reversal of Aave’s multichain expansion strategy. Rather, it is a strategic refocusing on select protocols that demonstrate resilience, liquidity, and user demand. “Aave will continue applying continuous risk assessment for all assets across all deployments,” he said. This means that other chains with weaker metrics could face similar wind-down proposals in the future, even if they have been part of the Aave ecosystem for years.
The comments also follow Aave’s launch on Avalanche earlier this month, which indicates that the protocol remains open to new integrations when the conditions are favorable. The Avalanche deployment is expected to bring Aave’s lending services to a chain with an established DeFi ecosystem, while the wind-down of six smaller markets helps reallocate resources to more productive venues.
Background on Aave and V3
Aave is a decentralized, open-source protocol that allows users to lend and borrow a wide range of cryptocurrencies. It originally launched as ETHLend in 2017 before rebranding to Aave, the Finnish word for “ghost,” in 2018. The protocol has since become one of the cornerstones of DeFi, with billions of dollars in total value locked across multiple blockchain networks. Aave V3, introduced in 2022, brought improvements such as efficient mode, isolation mode, and cross-chain functionality, enabling the protocol to expand rapidly across various Layer 1 and Layer 2 networks.
The multichain expansion was a core part of Aave’s growth strategy, allowing users on different blockchains to access the same liquidity pools and borrowing markets. However, not every deployment has achieved the same level of adoption. Some smaller chains suffered from low network activity, lack of developer interest, or competition from other lending protocols. Over time, maintaining these underperforming markets became a burden because each deployment requires ongoing risk monitoring, oracle maintenance, and administrative overhead.
LlamaRisk, the service provider behind this latest proposal, is a well-known risk management firm in the DeFi space. It conducts deep-dive risk assessments for Aave and other major protocols, analyzing everything from smart contract vulnerabilities to liquidity concentration and market manipulation potential. Working alongside other Aave service providers, LlamaRisk has become an essential part of Aave’s governance infrastructure, offering data-driven recommendations that help the protocol mitigate risks.
What the offboarding covers
The full list of offboarded reserves is expected to be published in the official ARFC, but the proposal specifically mentions 50 low-use reserves and 21 matured Pendle principal token listings. Pendle principal tokens represent a tokenized claim on the principal amount of an underlying asset that is locked in a Pendle market. As these tokens mature, they become effectively worthless as yield-generating instruments, and their continued inclusion on Aave adds unnecessary risk. Matured principal tokens can lose value quickly, and keeping them listed may expose the protocol to bad debt if the underlying assets default.
The six targeted chains — Sonic, Scroll, zkSync, Metis, Soneium, and Aptos — were chosen based on a combination of low liquidity, declining network usage, and minimal fee generation. While some of these chains have loyal user bases, their DeFi ecosystems have not reached the scale needed to support a fully functioning Aave market. For example, zkSync and Scroll are both zero-knowledge rollups that attracted significant attention during their launches, but the lending activity on Aave never materialized as expected. Metis and Soneium are smaller chains with even more limited DeFi footprints.
In practical terms, winding down a V3 market involves multiple steps. First, the protocol freezes the affected reserves, preventing new supplies and borrows. Then, the reserve factors are increased to encourage borrowers to repay their loans and suppliers to withdraw their assets. Finally, after a waiting period, the reserves are removed entirely from the Aave interface, and the deployment is deprecated. Users who fail to repay their loans during the wind-down period may face liquidation, so the proposal includes a lengthy timeline to give users ample opportunity to close their positions.
According to the latest data, the six affected chains account for $98.1 million in supplied assets and $15.6 million in debt. While these numbers are not insignificant, they represent a small fraction of Aave’s total value locked, which stands in the billions. The cleanup is therefore more about risk reduction than about immediate financial gain. By shutting down these markets, Aave can focus its resources on chains that generate sustainable revenue and maintain a healthy lending environment.
The governance process is still in its early stages, and the final AIP may include modifications based on community feedback. However, given the strong support for the temp check and the involvement of multiple service providers, it is likely that the proposal will pass. Once the AIP is executed, Aave will begin the formal wind-down process on the affected chains, marking the end of its multichannel presence on six networks.
In the meantime, Aave continues to explore new opportunities on other chains. The recent launch on Avalanche is just one example of how the protocol is sharpening its focus on ecosystems with demonstrated demand for decentralized lending. As the DeFi sector matures, the ability to cut losses on underperforming markets will be just as important as the ability to grow into new ones.
Source:Cointelegraph News