Aave V3's risk stewards, acting on LlamaRisk recommendations, are implementing a suite of parameter changes including cutting the USDe supply cap from 2 billion to 400 million — an 80% reduction — and reducing the syrupUSDT cap from 100 million to 18 million. PT-USDe E-Mode liquidation bonuses are also being trimmed, while LTV ratios on select PT positions are nudged marginally higher, reflecting nuanced position health across different maturities.
For Armada's crypto repo desk, the sharp USDe cap reduction is the most significant signal: it reflects on-chain risk managers pulling back from synthetic dollar exposure, which should inform Armada's own haircut and LTV benchmarks for any USDe or Ethena-adjacent collateral. The PT E-Mode adjustments are also relevant if Armada counterparties post principal tokens as collateral, as compressed liquidation bonuses affect the cost of enforcement in stress scenarios. Update the collateral eligibility matrix accordingly.