Aave V3 Risk Stewards, acting on LlamaRisk recommendations, approved a set of supply and borrow cap changes on April 30. The most significant adjustments are doubling USDG supply and borrow caps to $120M and $100M respectively, doubling the PT-USDG-28MAY2026 supply cap to $80M, and sharply cutting USDe's borrow cap from $1.8B to $360M on Ethereum Core while expanding it to $100M on MegaETH. Additional changes span Celo and X Layer markets.
For Armada's crypto desk, the 80% reduction in USDe borrow capacity on Ethereum Core is the most material signal. It indicates risk managers see elevated concentration or health risk in USDe positions, which should inform Armada's own haircut and LTV assumptions for any repo collateral involving USDe or synthetic dollar instruments. The USDG cap expansion in the same update reflects growing confidence in that asset, which may be relevant as tokenized T-Bill adjacent collateral types are evaluated.