Aave Community Proposes "Reducing the Loan Value Ratio of WBTC to 0"
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September 20, 2024
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PANews reported on September 20th that LlamaRisk submitted a proposal on September 18th to the Aave governance forum, suggesting adjustments to WBTC parameters on the Aave platform due to potential risks associated with BitGo's custody transition for WBTC.
The proposal recommends reducing WBTC's Loan-to-Value ratio (LTV) to 0 and lowering supply and borrowing limits to address potential risks arising from the custody change, ensuring stability for existing users.
These adjustments are aimed at preventing risk, not addressing an immediate threat. Aave plans to implement these changes gradually, with the intention of reversing them once trust is restored.
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