Aave(aave)

The deal includes Avon's lending protocols and onchain order book, but Aave Labs has not named a first market or launch date.

Bitcoin redemptions will resume once enough operators return, while Aave’s $123.2 million Ethereum Core tBTC reserve remains frozen.

LlamaRisk has proposed a 300 BTC collateral cap, but activating the market would still require a separate onchain governance vote.

Starloop borrows USDC against tokenized shares, adding liquidation risk to a strategy operating within Aave’s 37,000-token collateral cap.

Threshold also disclosed a separate incident that drained about 0.5 ETH from an operator’s fee-paying account. Aave’s frozen Ethereum Core reserve holds about $136.3 million of tBTC.

A hypothetical $10,000 collateral position loses $1,500 of borrowing headroom without changing its 1.33 health factor.

Aave’s Ethereum Core tBTC reserve remains frozen, while Gauntlet says roughly 640,000 USDC remains supplied to a tBTC-backed Morpho market.

Repayments, withdrawals and liquidations continue, while Aave’s Ethereum Core market holds about $136.5 million in tBTC deposits.

The collateral restrictions apply wherever the assets are listed, with different rules for existing V3 and V4 positions.

The plan would remove about $3.7 billion of unused borrowing capacity on V3 and $130 million on V4, while the existing freeze still blocks new loans.