Aave, one of the largest decentralized lending protocols, is moving to close its V3 markets on six blockchain networks and remove dozens of underperforming token reserves. The proposal, put forward with the support of risk management service LlamaRisk, would affect roughly $98.1 million in supplied assets and $15.6 million in debt across the affected deployments.

The governance initiative targets Sonic, Scroll, zkSync, Metis, Soneium, and Aptos, with every reserve on those chains recommended for retirement. In addition, LlamaRisk proposed offboarding 50 low-use reserves and 21 matured Pendle principal token listings across 11 Aave deployments. Balances were measured on July 28.

According to the proposal, this is not merely a routine cleanup but a significant step in Aave's evolving risk management strategy. The affected markets have shown declining liquidity, minimal revenue, and in some cases, deteriorating network activity. By winding down these deployments, Aave aims to reduce its economic and technical risk surface while concentrating resources on more promising blockchain ecosystems.

ARFC process and next steps

The proposal is framed as an ARFC, or Aave Request for Comments, which is a detailed governance document and precursor to an Aave Improvement Proposal (AIP). It is important to note that an ARFC does not represent a completed onchain vote or execution. Community members and delegates are expected to review the proposal, provide feedback, and potentially move it to a formal snapshot vote before a final AIP is executed.

The current recommendation is the result of collaboration between LlamaRisk and other Aave service providers. Their analysis focused on underperforming reserves and deployments that no longer meet Aave's revised risk and revenue standards. The proposal also includes a plan to increase the reserve factor on certain assets before full retirement, a technique designed to gradually reduce exposure and encourage users to move funds.

Aptos: A short-lived expansion

One of the most notable aspects of the proposal is the recommended exit from Aptos. Aave launched its V3 market on Aptos only 11 months before the proposed wind-down. According to LlamaRisk, available liquidity on the Aptos deployment has dropped by 94% over six months, and quarterly revenue is below $1,000. Such poor performance made the market a clear candidate for closure.

The Aptos market was one of the few among the six affected chains that remained active. While Scroll, zkSync, Metis, and Soneium had already frozen their reserves in previous governance actions, Sonic and Aptos were still operating. The new proposal recommends freezing both, which would prevent new borrowing and lending activity while users are encouraged to unwind positions.

Prior governance decisions set the stage

The move is not without precedent. In December 2025, Aave concluded a temperature check on its multichain strategy. The vote saw 923,400 votes in favor and less than 1% against a plan that included increasing the reserve factor on underperforming instances, shutting down the instances on zkSync, Metis, and Soneium, and establishing a $2 million annual revenue floor for any new instance deployment.

That governance signal set a clear expectation: Aave deployments must generate sufficient economic activity or face deprecation. The new proposal builds on this by extending similar treatment to Sonic, Aptos, and other low-performing markets.

Scroll was added to the list of affected protocols through an accelerated process in April. LlamaRisk filed a direct-to-AIP proposal to freeze every Scroll reserve and raise selected reserve factors, describing the measure as completing Scroll's deprecation after a rapid deterioration in network liquidity and Aave market activity. The community approved that measure, and Scroll's reserves have remained frozen since.

A new risk framework

In June, Aave published an updated risk framework covering asset, bridge, monitoring, and chain risk, as well as clear criteria for winding down reserves or entire deployments. This month's announcement indicates that Aave has effectively adopted those rules by applying them to real governance actions. The framework is designed to make Aave more resilient in the face of volatile market conditions and evolving blockchain threats.

The framework also introduces a technical asset listing framework, which aims to ensure that any new asset added to Aave meets strict standards for security, liquidity, and counterparty risk. By retiring underperforming reserves, Aave frees up governance resources and reduces the complexity of its protocol.

Founder comments

Aave founder Stani Kulechov weighed in on the proposal in a Thursday social media post. He said that winding down these markets will “reduce Aave’s economic and technical risk surface as part of the new Aave Risk Framework and Technical Asset Listing Framework.” His comments suggest that the proposal is a deliberate outcome of a broader strategic review, not an improvised response to market fluctuations.

Kulechov also stressed that this is not a reversal of Aave's multichain expansion strategy. Rather, it is a strategic refocusing on select protocols. “Aave will continue applying continuous risk assessment for all assets across all deployments,” he said. The comments follow Aave's recent launch on Avalanche, which indicates that the protocol remains committed to expanding into networks that show strong fundamentals and user demand.

Multichain strategy evolves

Aave has long been one of the most active protocols in the decentralized finance space, deploying its V3 lending technology across a wide range of blockchains. This aggressive expansion helped Aave become a dominant lender in the DeFi ecosystem, with billions of dollars in total value locked. However, not every deployment achieved the same level of success.

Some networks attracted initial enthusiasm but saw liquidity dry up as incentives faded or as users migrated to other platforms. Others struggled with technical issues, bridge reliability, or simply lack of organic demand. Over time, these underperforming markets became a drag on Aave's efficiency, requiring ongoing maintenance and exposing the protocol to unnecessary risk.

The decision to wind down markets on six blockchains represents a maturation of Aave's governance. Instead of chasing ecosystem growth at any cost, the protocol is now applying data-driven criteria to determine where its capital and attention should go. This approach is broadly in line with industry trends, as many DeFi protocols have begun to consolidate after years of rapid expansion.

The affected networks include:

• Sonic
• Scroll
• zkSync
• Metis
• Soneium
• Aptos

In total, 25 reserves on these chains are recommended for retirement. Combined with the offboarding of 50 low-use reserves and 21 matured Pendle principal token listings across other deployments, the proposal touches a significant portion of Aave's V3 ecosystem.

What happens next

Governance participants will now review the ARFC and decide whether to move it to a snapshot vote. If approved, the proposal would then be implemented through an AIP, which would execute the necessary smart contract changes. Users with positions on the affected chains would need to withdraw their funds and repay any outstanding debt before the markets are fully deprecated.

The timeline for these changes has not been fully specified, but Aave has generally followed a structured process to ensure that users have adequate time to exit. In previous wind-downs, the protocol increased reserve factors gradually and provided clear warnings before permanently freezing markets.

For users currently supplying assets or borrowing on Sonic, Aptos, or any of the other affected chains, the proposal serves as an early signal to prepare. While the ARFC is subject to change, the direction is clear: Aave is tightening its focus and prioritizing sustainability over indiscriminate expansion.

The broader market is also watching this development as a sign of how leading DeFi protocols are adapting to a more mature and risk-conscious environment. With the rise of tokenized real-world assets, institutional interest, and evolving chain ecosystems, Aave's ability to quickly prune underperformers while expanding on promising networks could become a competitive advantage.

In the coming weeks, the community will likely debate the specifics of the proposal, including revenue thresholds, reserve factors, and the fate of assets stranded on soon-to-be-deprecated networks. The outcome will set a precedent for how Aave handles future deployments and could influence other lending protocols facing similar challenges.

For now, Aave remains one of the most influential protocols in DeFi, and its governance decisions continue to shape the broader ecosystem. The proposed wind-down is a reminder that even the most successful protocols must periodically reassess their strategies and make difficult choices to remain resilient in a fast-changing market.

Source: Cointelegraph News