Aave is scaling back parts of its lending protocol by removing dozens of low usage assets and ending support for six blockchain deployments as part of a broader effort to streamline operations and reduce exposure to inactive markets.
In a July 30 post on X, founder Stani Kulechov said the changes affect approximately $98.1 million in supplied assets and $15.6 million in outstanding debt. The initiative also introduces two new internal governance frameworks aimed at preventing the protocol from maintaining markets with little user activity.
Aave Moves to Remove Inactive Markets
Kulechov announced that Aave will phase out 50 asset reserves with limited adoption across multiple markets. At the same time, the protocol will discontinue operations on Sonic, Scroll, zkSync, Metis, Soneium, and Aptos, impacting another 25 asset reserves.
The overhaul also includes retiring 21 Pendle PT tokens that have reached maturity, replacing them with newer maturity series.
According to implementation documents released with the proposal, risk management firm LlamaRisk and other Aave service providers recommended removing inactive Aave V3 reserves along with the six blockchain deployments.
The inactive reserves account for roughly $85.3 million in supplied assets and $11.5 million in outstanding debt, while the blockchain deployments scheduled for closure hold approximately $12.8 million in deposits and $4.1 million in debt.
On Ethereum, two Bitcoin liquid staking assets, FBTC and eBTC, represent the largest portion of the assets being removed. Combined deposits in the two tokens have fallen from about $72 million six months ago to roughly $16 million today.
Several bridged stablecoins are also being retired after users migrated to their native versions. Meanwhile, the MaticX token is being removed because its issuer, Stader, is discontinuing support for the asset.
LlamaRisk noted that each of the six blockchain deployments now generates less than $5,000 in quarterly revenue, making them too costly to maintain given ongoing oracle and monitoring expenses.
Activity on those networks has declined sharply over the past six months. Deposits on Sonic have dropped from $28.9 million to $7.6 million, while Scroll has seen deposits fall from $16.1 million to just $2.2 million.
To minimize disruption, Aave plans to phase out the affected markets gradually, allowing users sufficient time to withdraw funds or repay loans while reducing liquidation risks. Under the proposed process, each reserve will first be frozen before its supply and borrowing limits are reduced to one.
Oracle Infrastructure Also Under Review
The proposal extends beyond asset reserves to Aave’s price oracle infrastructure.
LlamaRisk recommended retiring several Chainlink price feeds associated with low activity assets across both Aave V2 and V3. According to the assessment, these assets have experienced significant declines in liquidity and trading volume, making accurate price reporting increasingly difficult.
The oracle changes would affect 10 protocol deployments representing approximately $6.76 million in supplied assets and $4.29 million in outstanding debt.
The latest restructuring follows several major developments for Aave this year.
In May, two of the protocol’s United Kingdom subsidiaries secured approval from the Financial Conduct Authority to operate cryptocurrency exchange and electronic money services.
A month later, Grayscale Research estimated AAVE’s fair value at around $175 over the next year, citing the protocol’s strong position in decentralized lending, its approximately 200,000 monthly active users, and its expansion into tokenized real world assets through its institutional lending platform, Horizon.#crypto#cryptonews https://coinsignals.net https://t.me/coinsignalpublic
