Aave governance is moving to standardize how Ethena's stablecoin collateral behaves across multiple blockchain deployments. A new proposal seeks to establish unified efficiency modes—the protocol's risk tiers that allow higher leverage on correlated assets—for USDe and sUSDe across Aave V3 instances on Ethereum, Polygon, Mantle, Monad, and Avalanche. The core rationale is elegantly practical: consolidating fragmented legacy configurations that have accumulated over time, each with slightly different parameters, creates unnecessary complexity and potential arbitrage opportunities that could undermine the protocol's risk management.
The proposal maintains aggressive leverage for stablecoin pairs while bringing consistency to the ecosystem. Under the new scheme, USDe would carry a 91% loan-to-value ratio and 93% liquidation threshold against stablecoins, while sUSDe (Ethena's staked version) would operate at 90% LTV and 92% LT. These figures represent competitive borrowing power, reflecting Ethena's established track record as a delta-neutral dollar asset. Notably, the existing reference modes on some chains already offered 90% LTV, so the consolidation primarily raises floors on others while tightening outliers. The proposal demonstrates how e-modes function within Aave's risk architecture: by creating asset-specific tiers, the protocol can offer borrowers enhanced capital efficiency without compromising safety across the broader portfolio.
Managing the transition carefully, the proposal retires legacy positions by setting their loan-to-value ratios to zero, preventing new borrowing against outdated collateral categories. Critically, liquidation thresholds remain unchanged on existing positions, meaning users face no immediate danger—their health factors remain stable. This surgical approach avoids forced liquidations while nudging liquidity toward the standardized configurations. The consolidation affects roughly $709 million in collateral and $637 million in debt spread across these legacy categories, primarily on Ethereum Core and Polygon. Certain edge cases receive specific treatment: Plasma's category #21 sees a minor LT adjustment from 93.1% to 93%, while matured positions on Monad and X Layer are formally removed, and USDe borrowing capability is stripped from Avalanche.
This restructuring reflects Aave's maturing governance approach—prioritizing parameter consistency and operational efficiency rather than piecemeal optimizations. As Ethena expands across new chains and derivative products multiply, standardized e-mode frameworks become critical infrastructure for risk management at scale.