<![CDATA[Proposed Aave Rate Reset Aims to Break Liquidity Stalemate]]>12be6c05-2ff1-4907-9fc1-54132f799c25-image.png
Liao’s proposal introduces a two-step adjustment to restore balance in Aave markets, starting with an immediate Risk Steward intervention followed by a formal governance vote. The plan would raise Slope 2 to 40% and lower optimal utilization to 87% to encourage fresh capital inflows.

In the second phase, parameters would be pushed further, with a maximum supply rate approaching 48%. The goal is to make lending yields high enough to attract rapid external liquidity and push utilization back below critical thresholds.

The adjustment is designed to correct what Liao describes as structurally insufficient incentives, where borrowing remains attractive even under elevated rates due to low carry costs for short-term arbitrage strategies.

]]>https://undeads.com/forum/topic/18916/proposed-aave-rate-reset-aims-to-break-liquidity-stalemateRSS for NodeTue, 05 May 2026 05:41:20 GMTThu, 23 Apr 2026 05:33:21 GMT60<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 20:37:09 GMT]]>If this works, Aave comes out stronger 👀.

]]>https://undeads.com/forum/post/51831https://undeads.com/forum/post/51831Thu, 23 Apr 2026 20:37:09 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 20:35:59 GMT]]>Feels like controlled tightening phase.

]]>https://undeads.com/forum/post/51828https://undeads.com/forum/post/51828Thu, 23 Apr 2026 20:35:59 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 20:33:53 GMT]]>But high rates can stress borrowers hard.

]]>https://undeads.com/forum/post/51821https://undeads.com/forum/post/51821Thu, 23 Apr 2026 20:33:53 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 20:31:34 GMT]]>Governance acting quickly is a good sign.

]]>https://undeads.com/forum/post/51818https://undeads.com/forum/post/51818Thu, 23 Apr 2026 20:31:34 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 20:29:33 GMT]]>Fast liquidity stable liquidity

]]>https://undeads.com/forum/post/51811https://undeads.com/forum/post/51811Thu, 23 Apr 2026 20:29:33 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 20:27:33 GMT]]>Market will chase yield, let’s see how sticky it is.

]]>https://undeads.com/forum/post/51808https://undeads.com/forum/post/51808Thu, 23 Apr 2026 20:27:33 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 20:25:22 GMT]]>Arb strategies exploiting low carry got too comfortable

]]>https://undeads.com/forum/post/51801https://undeads.com/forum/post/51801Thu, 23 Apr 2026 20:25:22 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 20:23:21 GMT]]>Incentives were clearly misaligned before this.

]]>https://undeads.com/forum/post/51798https://undeads.com/forum/post/51798Thu, 23 Apr 2026 20:23:21 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 10:38:48 GMT]]>Pushing utilization down is key here.

]]>https://undeads.com/forum/post/51771https://undeads.com/forum/post/51771Thu, 23 Apr 2026 10:38:48 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 10:15:40 GMT]]>Short-term fix vs long-term stability is the real question.

]]>https://undeads.com/forum/post/51768https://undeads.com/forum/post/51768Thu, 23 Apr 2026 10:15:40 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 10:11:47 GMT]]>Two-step approach makes sense under pressure.

]]>https://undeads.com/forum/post/51761https://undeads.com/forum/post/51761Thu, 23 Apr 2026 10:11:47 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 09:12:23 GMT]]>Higher yields = capital inflow… but also more risk.

]]>https://undeads.com/forum/post/51715https://undeads.com/forum/post/51715Thu, 23 Apr 2026 09:12:23 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 09:08:38 GMT]]>40% slope is aggressive, they really want deposits fast.

]]>https://undeads.com/forum/post/51708https://undeads.com/forum/post/51708Thu, 23 Apr 2026 09:08:38 GMT<![CDATA[Reply to Proposed Aave Rate Reset Aims to Break Liquidity Stalemate on Thu, 23 Apr 2026 09:05:13 GMT]]>Rate hikes to fix liquidity… classic DeFi playbook.

]]>https://undeads.com/forum/post/51705https://undeads.com/forum/post/51705Thu, 23 Apr 2026 09:05:13 GMT