Highlights

Aave is proposing to exit six underused blockchain deployments that together hold roughly $98 million in deposits but generate negligible revenue. These markets produce under $5,000 in quarterly revenue each, far below the operational costs of supporting price feeds, liquidation systems and monitoring. The proposal would freeze new activity, make borrowing deliberately expensive and route most borrower interest to the protocol treasury so remaining positions unwound voluntarily. This cost-versus-benefit calculus is the central reason behind the proposed shutdowns.

Sentiment Analysis

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  The overall sentiment of the article is neutral-to-mixed: it presents factual financial figures and operational rationale while noting the pragmatic trade-offs. The tone emphasizes economic logic and risk management rather than alarm or celebration. The piece highlights sharply falling deposits and tiny revenue streams that make continued support uneconomical, but it also notes that users’ positions would not be forcibly closed and that the action is framed as protective governance.
  
  
  

  
  45%
  

  
  
  
  

Article Text

Aave, one of the largest decentralized lending protocols, has put forward a proposal to withdraw support from six blockchains where its deployments have seen minimal user activity and revenue. The proposal targets deployments on Sonic, Scroll, zkSync, Metis, Soneium and Aptos, and would retire low-adoption asset markets and a set of expired Pendle principal tokens across multiple Aave instances. Collectively these markets account for a small fraction of the protocol’s total assets but require continuous upkeep that, the proposal argues, exceeds the benefits they deliver.

The financial rationale is straightforward. Each of the six deployments generates under $5,000 in revenue per quarter, with Metis, Soneium and Aptos producing less than $1,000 each. Those amounts do not cover the fixed costs of running a market: maintaining accurate price oracles, operating liquidation mechanisms, monitoring risk parameters and performing ongoing administration. By comparison, Aave’s mainnet deployment produces orders of magnitude more revenue, and even some second-layer deployments yield materially larger sums. Given that disparity, the marginal returns from the six low-use chains are effectively trivial relative to the protocol’s overall scale.

Usage and liquidity have declined sharply on these networks over recent months. Reported declines include precipitous drops in available liquidity and deposits across the six chains, with percentage decreases ranging from the high seventies into the nineties for some deployments. As deposits and activity contracted, so did the fee flows associated with borrowing and liquidation, further reducing any incentive to continue supporting those markets. The combined deposits on the six chains represent under 1% of Aave’s assets across all supported chains, making them both small in economic terms and relatively costly to maintain.

The proposed mechanics for shutting down the markets avoid immediate forced liquidations. Instead, Aave would freeze new deposits, borrowing and collateralization, restrict supply and borrowing to a minimal token set, and divert the majority of borrower interest to the protocol treasury while introducing a steep base borrowing rate. The design intentionally raises the cost of borrowing to encourage users to exit positions voluntarily over time rather than triggering abrupt closures. Existing positions would remain open until users unwind them under these constrained conditions.

Framed in governance terms, the proposal aligns with a broader shift in Aave’s deployment policy that favors concentrating resources on markets that demonstrate product-market fit and sustainable revenue. A prior governance recommendation introduced a revenue threshold for future deployments, reflecting lessons from markets that failed to attract sufficient liquidity. The current cleanup is presented as both a cost-saving and risk-reduction measure: smaller markets can impose disproportionate operational overhead and monitoring risk relative to their economic contribution.

Financially, the decision also responds to a broader revenue downturn. Gross revenue for the protocol has shown quarter-to-quarter declines, and liquidation fees in particular have fallen sharply. When protocol revenue softens, marginally productive markets become harder to justify because the fixed costs of supporting them consume a larger share of limited resources. From this perspective, decommissioning low-adoption deployments is a defensive step to protect the protocol’s core economics and free up attention and resources for higher-value deployments.

The operational approach aims to balance prudence with user protection. By avoiding forced liquidations and allowing time for positions to be closed voluntarily, the proposal reduces immediate user harm while still achieving the goal of winding down nonviable markets. The central insight is that the marginal revenue of these deployments is so small that continued maintenance is economically indefensible, especially as the protocol refocuses on more productive chains and tighter deployment standards.

In summary, the proposal reflects a pragmatic governance decision: remove support for underperforming chains to lower operational cost and concentrate resources where they deliver meaningful value. The mechanics chosen aim to minimize sudden disruption for users while ensuring the protocol does not bear ongoing losses from markets that provide negligible benefits.

Key Insights Table