The GHO Stewards proposed raising the GHO stablecoin borrow rate on Aave V3 Ethereum Core from 4.25% to 4.50% APR, matching the Aave Savings Rate, while increasing the Ethereum Prime base rate from 2.75% to 3.00%, preserving a 25 basis point discount to Core. The move is triggered by USDC and USDT borrow costs reaching 4.39%, approaching the 4.50% threshold that was the stated precondition for the GHO increase.
For Armada's crypto repo desk, GHO and Aave stablecoin rates serve as real-time on-chain benchmarks against which crypto-collateralized repo terms are benchmarked. A GHO Core rate at 4.50% closes the arbitrage gap that made GHO cheaper than USDC and USDT borrow, potentially reducing demand for GHO-funded strategies among market maker and hedge fund counterparties and nudging overall on-chain stablecoin rate floors higher.