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Aave Raises Core GHO Borrow Rate to 4.5% Amid Thin Redemption Reserves

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Aave’s GHO Risk Council raised the Core GHO borrow rate to 4.5% and also increased Prime’s base rate while Ethereum’s USDC conversion module stayed nearly empty. The proposal and subsequent changes covered Ethereum’s Core and Prime markets, with reserve recovery tied to how borrowers obtain GHO to repay loans. The move leaves open how borrowing activity and redemption reserves will develop next.

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Key claims & sources

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The proposed changes covered Ethereum’s Core and Prime markets.
Aave Proposal Would Raise GHO Borrowing Rates as Reserves Run Low
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Reserve recovery depends in part on how borrowers obtain GHO to repay loans.
Aave Proposal Would Raise GHO Borrowing Rates as Reserves Run Low
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Aave’s GHO Risk Council raised the Core GHO borrow rate to 4.5% on Ethereum.
Aave Raises Core GHO Borrow Rate to 4.5% Amid Thin Redemption Reserves
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The same action also lifted Prime’s base rate.
Aave Raises Core GHO Borrow Rate to 4.5% Amid Thin Redemption Reserves

What it means

Borrowers using Aave’s GHO markets notice the change immediately because Core and Prime rates moved, including a Core borrow rate of 4.5% and a higher Prime base rate. Ethereum users watching the redemption side also see that the USDC conversion module was nearly empty at the time of the shift.

What changes in practice is the cost structure in the Core and Prime markets, which is different from before the adjustment. The market scope stays the same, since the proposed changes were still aimed at Ethereum’s Core and Prime markets rather than a different network or product.

Market reaction i

AaveAAVE it is the asset of the company or protocol in the event

Aave rose 1.7% in the 4 hours after the first headline, after falling 0.8% in the 2 hours before.

$181.75 price at the headline
-0.8% 2 h before
+1.7% 4 h after
-0.7% 12 h after
First headline

47 prices, one every 30 minutes

Coverage timeline

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Oct 5 20:26
+16 min
Oct 5 20:42
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Has this happened before?

WhenWhat happenedFigure
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