Aave governance is considering a broad cleanup of its V3 lending markets, targeting underused reserves across multiple blockchains and retiring certain matured listings. The proposal, detailed in an ARFC (Aave Request for Comment), outlines offboarding activity on six chains and removing dozens of low-adoption assets, covering $98.1 million in supplied collateral and $15.6 million in outstanding debt, measured as of July 28.

Risk services provider LlamaRisk, working alongside other Aave service providers, recommended deprecating 50 low-use reserves and retiring 21 matured Pendle principal token listings across 11 deployments. The same proposal also calls for retiring all 25 reserves on Sonic, Scroll, zkSync, Metis, Soneium and Aptos.

Key takeaways

• Aave’s ARFC targets low-adoption assets and matured Pendle principal token listings, with balances snapshot at July 28.
• The plan would wind down V3 markets on six blockchains and deprecate 50 low-use reserves across 11 deployments.
• All chain-specific closures proposed here come after earlier freezes and prior governance decisions on certain networks.
• Aave founder Stani Kulechov framed the move as reducing the protocol’s “economic and technical risk surface” under updated frameworks.
• This ARFC is a proposal step, not proof that a final onchain vote has already passed.

Why this proposal is moving forward

ARFCs are a formal governance stage at Aave: they provide detailed recommendations and serve as a precursor to an Aave Improvement Proposal. As such, the publication of this ARFC does not itself confirm that the changes have been approved via an onchain vote or executed by the protocol.

Even so, the scope is notable. The offboarding plan described in the ARFC would restructure Aave’s V3 presence on multiple networks—primarily by removing reserves where usage has been insufficient and by retiring token listings that have reached maturity. In total, the proposal covers $98.1 million in supplied assets and $15.6 million in debt, indicating that the affected V3 markets are meaningful in size even if they are not retaining strong participation.

Aptos exit follows a short-lived V3 rollout

The most time-sensitive portion of the cleanup appears to be the proposed Aptos exit. According to data cited by LlamaRisk, the V3 market launch on Aptos occurred roughly 11 months before this ARFC recommendation.

LlamaRisk attributes weak performance to a sharp liquidity contraction and minimal earning. It reports that available liquidity fell by 94% over six months and that quarterly revenue was below $1,000. Those figures, as referenced in the ARFC summary, set the justification for moving from an active posture to a full deprecation across the network.

The same recommendation also distinguishes between chains that were already inactive in practice and those that were still operating. The ARFC indicates that every reserve on Scroll, zkSync, Metis and Soneium was already frozen. By contrast, Sonic and Aptos were still active at the time of the snapshot, and the ARFC recommends freezing and retiring reserves on those remaining deployments.

How earlier “temp checks” shaped the current cleanup

The proposal builds on prior governance outcomes and implementation steps across Aave’s multichain V3 strategy. Earlier in the process, a “temp check” on Aave’s multichain approach concluded on Dec. 5, 2025. That vote, described in Aave governance materials, recorded 923,400 votes in favor with under 1% voting against, and it covered actions such as increasing reserve factors on underperforming instances, shutting down instances on zkSync, Metis and Soneium, and establishing a $2 million annual revenue floor for new instance deployment.

Additionally, Aave governance processes have already accelerated deprecations on specific chains. In April, Scroll was added to the list of affected protocols through an accelerated procedure. A corresponding governance action described the move as completing Scroll’s deprecation after rapid deterioration in network liquidity and Aave market activity, via a direct-to-AIP proposal filed by LlamaRisk.

Beyond instance closures, Aave’s risk posture has also been formalized in updated internal documentation. The protocol published an updated risk framework on June 9, covering asset risk, bridge and monitoring risks, chain risk, and criteria for winding down reserves or deployments. Separate governance activity later this month indicated de facto adoption of rules under a newer “governance framework v2,” pointing to a more structured approach to deciding when underperforming deployments should be reduced or removed.

Aave founder ties the move to risk-framework changes

Aave founder Stani Kulechov publicly commented that the cleanup is intended to reduce exposure as the protocol applies its new risk approach. In a Thursday post on X, Kulechov said the deprecations would also “reduce Aave’s economic and technical risk surface as part of the new Aave Risk Framework and Technical Asset Listing Framework.”
Source: Stani Kulechov on X

While the current action may look like an exit from certain environments, Kulechov’s framing suggests it is not a retreat from multichain itself. He stated that Aave will continue applying continuous risk assessment for assets across deployments, with the immediate effect being a refocusing on selected chains where usage and performance are stronger.

The comments also arrive amid Aave’s ongoing expansion activities elsewhere. Earlier coverage from Cointelegraph noted that Aave is launching on Avalanche, and the current governance cleanup appears to align with that broader operational theme: expand into targeted environments while methodically trimming underused or deteriorating ones.

What to watch next for Aave V3 users and liquidity providers

If this ARFC advances, the key question will be how quickly the proposed offboarding transitions from governance discussion to formal execution—and whether Aave provides additional updates on how liquidity is expected to migrate as reserves are frozen and retired. Investors and DeFi participants should also watch for signals that the newly adopted risk frameworks keep tightening the threshold for maintaining V3 markets on smaller or less liquid chains.

An Aave governance proposal would wind down the lending protocol’s V3 markets on six blockchains and retire dozens of low-use token listings, a cleanup covering $98.1 million in supplied assets and $15.6 million in debt.

Risk service provider LlamaRisk, working with other Aave service providers, recommended offboarding 50 low-use reserves and 21 matured Pendle principal token listings across 11 deployments. It also proposed retiring all 25 reserves on Sonic, Scroll, zkSync, Metis, Soneium and Aptos. The balances were measured on July 28.

An ARFC is a detailed proposal and precursor to an Aave Improvement Proposal; it is not, by itself, proof of a completed final onchain vote or execution.

Aptos exit follows recent launch

The proposed Aptos exit comes just 11 months after Aave launched its V3 market there, with available liquidity down 94% over six months and quarterly revenue below $1,000, according to LlamaRisk.

Every reserve on Scroll, zkSync, Metis and Soneium was already frozen, whereas Sonic and Aptos remained active and are recommended for freezing. The temp check on Aave’s multichain strategy concluded on Dec. 5, 2025, with 923,400 votes in favor and under 1% against 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 new instance deployment.

Related: Aave positioned to capture tokenized asset growth in DeFi: Standard Chartered

Scroll was then added to the affected protocols through an accelerated process in April, as 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. Aave also published an updated risk framework on June 9, covering asset, bridge, monitoring and chain risk and criteria for winding down reserves or deployments, and this month’s announcement indicated de facto adoption of those rules by the protocol.

Source: Stani Kulechov

Aave founder Stani Kulechov said in a Thursday post that this will also “reduce Aave’s economic and technical risk surface as part of the new Aave Risk Framework and Technical Asset Listing Framework.”

Related: Aave brings V3 lending and GHO stablecoin to Monad

Still, this is not a reversal of Aave’s multichain expansion strategy, rather a strategic refocusing on select protocols. “Aave will continue applying continuous risk assessment for all assets across all deployments,” Kulechov said. The comments also follow Aave launching on Avalanche earlier this month.

Magazine: The real reason DeFi projects that survived 2022 crash are shutting down now

Bitcoin and Ether options with a combined notional value of about $10.43 billion expired on July 31, placing the $64,000 Bitcoin level at the center of the monthly settlement.

Greeks.live reported that 149,000 Bitcoin options worth $9.6 billion expired with a 0.28 put-call ratio and $64,000 max pain. Another 435,000 Ether options worth $830 million expired with a 0.63 ratio and $1,850 max pain.

Deribit’s monthly options settle at 08:00 UTC on the final Friday of each month. Shortly after settlement, Bitcoin traded near $63,824, while Ether changed hands around $1,891. Neither asset recorded an immediate break from its recent range.

Bitcoin options expiry settled near $64,000 max pain

The Bitcoin expiry represented about 30% of outstanding contracts, according to Greeks.live. Its low 0.28 put-call ratio showed that call open interest greatly exceeded put open interest going into settlement.

A separate PerpFinder snapshot, based on Deribit data at 07:51 UTC, recorded $7.39 billion in call open interest and $2.06 billion in puts. It placed total notional open interest at $9.45 billion, slightly below Greeks.live’s $9.6 billion estimate. The difference likely reflects changing Bitcoin prices and data captured at different times.

Max pain refers to the settlement price at which the largest value of options would expire without value for buyers. It does not guarantee that the spot market will move toward that level or remain there afterward.

Recent activity supports that caution. Research covering two earlier July expiries found that Bitcoin did not settle precisely at the stated max-pain levels and showed little lasting price movement after the contracts expired.

Call-heavy positioning did not confirm a bullish breakout

The low Bitcoin put-call ratio appears bullish at first because calls provide upside exposure. However, many calls were concentrated above the market price, particularly around the $70,000 and $72,000 strikes.

Contracts at those levels could not generate gains at expiry unless Bitcoin rose sharply above its weekly range. Bitcoin instead traded within a 24-hour range of roughly $63,787 to $65,305, keeping the largest upside positions out of the money.

Greeks.live said call gamma exposure was spread across several strikes, while put gamma exposure was more concentrated. Gamma measures how quickly an option’s price sensitivity changes when the underlying asset moves. Concentrated exposure can affect how dealers hedge, but it does not independently forecast market direction.

The firm also said “the conditions for a rally are not in place,” citing limited capital inflows and weak follow-through when U.S. equities rebounded. That is the firm’s market assessment rather than a confirmed future outcome.

Ether options showed stronger downside protection

Ether’s 0.63 put-call ratio showed more demand for puts relative to calls than the Bitcoin market recorded. Greeks.live placed Ether’s max-pain level at $1,850, below the market price shortly after settlement.

PerpFinder’s final pre-expiry snapshot recorded approximately $499.4 million in Ether call open interest and $311.5 million in puts. It calculated total open interest of $810.9 million and a 0.62 ratio, close to the figures provided by Greeks.live.

Ether traded near $1,891 after settlement, within a 24-hour range of about $1,884 to $1,934. The asset therefore remained above both the $1,850 max-pain estimate from Greeks.live and the $1,800 level cited by some earlier market reports.

As previously reported, Ether options carried a 1.26 put-call ratio during the July 10 expiry. The fall to about 0.63 indicates that positioning became less defensive by month-end, although Ether still carried more relative put exposure than Bitcoin.

ETF inflows and $65,000 resistance shape the next move

The expiry arrived as spot Bitcoin ETF demand showed signs of recovery. U.S. funds received $233.1 million on July 30, led by BlackRock’s IBIT with $183.4 million. However, flows had alternated between gains and withdrawals earlier in the week, supporting Greeks.live’s description of uneven capital demand.

Bitcoin also remained below the heavy trading area above $65,000 identified by Greeks.live. The asset briefly reached a 24-hour high above $65,300 but returned below $64,000, showing that buyers had not established the former rally zone as support.

crypto.news reported that the smaller July 10 expiry also produced cautious positioning and limited confidence in a sustained advance. Earlier July 3 coverage placed attention on weak ETF flows and demand for short-term downside protection.

Traders will next monitor whether positions roll into the August 28 monthly expiry. Deribit data showed about $3.15 billion already positioned for that date in Bitcoin options, while the September 25 expiry carried roughly $6.22 billion.

A sustained move above $65,000, stronger spot volume and several consecutive ETF inflow sessions would provide clearer evidence of improving demand. Without those conditions, the July settlement mainly removed a large block of expiring exposure while leaving Bitcoin’s wider trading range unresolved.

Tokyo-listed Quantum Solutions (2338) sold 1,000 ETH for $1.9 million and more than doubled its disposal ceiling to fund an AI data center business.

The move came as another crypto treasury firm, Hyperscale Data (GPUS), monetized about 100 BTC and opened a bitcoin-backed credit line for a Michigan AI data center..

Quantum sold the ETH on July 30 at $1,903 per token, generating $1.903 million after fees, according to a company filing. It expects to recognize a $100,970 loss against the position’s May 31 carrying value of $2,003.97 per ETH, the filing adds.

The sale price was 47% below the $3,595.02 average acquisition cost Quantum reported in June.

The firm sold 904 ETH for $1.61 million on June 16 at an average price of $1,777 per token. The two disposals raised about $3.51 million and reduced its holdings by 29% to 4,764.8 ETH from 6,668.8 ETH.

Quantum’s board raised the cumulative sale limit to 4,375 ETH from 1,875 ETH through Oct. 30, leaving it authorized to sell another 2,471 ETH. Using the full limit would mean disposing of nearly 66% of the holdings it reported in June.

Perpetual futures tied to tokenized stocks and commodities generated nearly as much trading volume as Bitcoin perpetuals on two of the largest venues for the products over the past week, according to Talos.

Combined seven-day volume across tracked real-world asset (RWA) perps reached $61.7 billion, equal to 99.2% of Bitcoin perpetual volume on Hyperliquid and Binance, where most trading activity is concentrated, Talos told Cointelegraph in an email summary citing a data snapshot taken on Thursday.

Tokenized equity contracts accounted for 57.8% of the total, followed by commodities at 28.2%.

The value of onchain RWAs has grown to about $36.8 billion, excluding stablecoins, according to RWA.xyz. Crypto exchanges have also expanded their offerings beyond cryptocurrencies, increasingly listing tokenized stocks and commodities alongside digital assets.

Related: Tokenized RWA market grows 420% since 2025 on regulatory clarity, access

Hyperliquid recorded $25.1 billion in RWA perpetual trading volume during the week of July 13 to July 19, exceeding the combined volume of all other perpetual categories on its platform.

Circle co-founder and CEO Jeremy Allaire said in a July 24 X post that growing RWA trading on Hyperliquid signals crypto markets moving “away from speculating on endogenous digital commodities.”

Growth continues into the new week

Early data for the current week suggests the trend is continuing. RWA perpetual trading volume has already reached $37.2 billion, exceeding Bitcoin perpetual volume by about 9%, according to Talos’ dashboard.

RWA perpetual futures volume as a percentage of Bitcoin perpetual futures volume on Hyperliquid and Binance. Source: Talos

Equity-linked contracts accounted for $22.8 billion of the total, followed by commodities at $9.1 billion and indexes at $4.2 billion. ETFs contributed about $338 million, while foreign exchange, pre-IPO and other RWA contracts made up the remainder.

Earlier in July, Pantera Capital said perpetual futures could become a dominant trading instrument beyond crypto, citing advantages such as 24/7 trading, the absence of contract expiries, simpler position management and continuous price discovery.

Hyperliquid’s growth has drawn attention from traditional finance. Intercontinental Exchange CEO Jeffrey Sprecher, whose company owns the New York Stock Exchange, recently urged regulators to create a “level playing field” for 24/7 onchain perpetual futures, arguing that existing market structures should not prevent the development of blockchain-based trading.

Despite the growth, RWA perpetuals remain a relatively small segment of the broader crypto derivatives market. Talos’ data shows aggregate futures trading volume of about $821.4 billion over the past seven days, with tracked RWA perpetuals accounting for roughly 7.5% of the total.

Magazine: The 100x obsession: Fundamentals grow in importance as crypto matures

Trading bitcoin BTC$64,171.64 these days feels much as it did seven months ago, at the start of the year.

The price of the largest cryptocurrency is stuck in a tight range, with volatility at six-month lows, and traders are struggling to identify a break to bet on. Not surprisingly, transaction volume has slumped and is on track for the lowest since November 2023.

Back in January, the bitcoin price had been stuck in a narrow band, $86,000-$90,000, since the second half of December. Trading volume had dropped to an average of $5.1 billion a day, and has fallen to $2.2 billion this month, according to research from K33.

What happened next is interesting. Volatility picked up in the following weeks, the price rose to nearly $98,000 by mid-January and then slid down to around $60,000 by early February. Trading volume rose.

And that’s precisely the point. Volatility is cyclical: long stretches of quiet price action often precede a sharp move in one direction or the other. Like a coiled spring, the tighter the market compresses, the more forcefully it can unwind.

Tokenized gold is getting a burst of investor attention this year, tracking a surge in physical bullion demand as gold prices have repeatedly set fresh highs. But a new report from RedStone suggests that—despite improving market conditions—only a small portion of tokenized gold is actually being used in decentralized finance.

RedStone data points to a widening gap between market interest in tokenized bullion and its deployment in DeFi lending. In the first quarter, tokenized gold spot trading volume reached $90.7 billion as gold futures climbed above $5,600 per troy ounce. Yet just $63 million worth of tokenized gold—via Tether Gold (XAUT) and PAX Gold (PAXG)—is currently posted as collateral on Aave v3 and Morpho, according to RedStone. That collateral usage represents roughly 1.5% of the tokens’ combined $4.2 billion market capitalization.

Key takeaways

• Tokenized gold saw high activity in spot markets, with $90.7 billion in Q1 trading volume.
• Despite that liquidity, DeFi adoption remains thin: only about $63 million in XAUT and PAXG is used on Aave v3 and Morpho.
• RedStone highlights a real stress test: Aave processed its largest cluster of XAUT liquidations on March 23 without disruption during a sharp gold sell-off.
• Gold has been under pressure from expectations of higher US interest rates, which can reduce demand for non-yielding assets.

A resilient collateral asset, but with limited deployment

RedStone’s report frames tokenized gold as “battle-tested” in DeFi collateral, even while showing that the broader adoption story is still early. The core issue is not whether tokenized bullion can hold up during market volatility—it can—but whether enough capital is being placed into decentralized lending markets to make tokenized gold a meaningful on-chain primitive.

To ground that claim, RedStone points to Aave’s performance during a major sell-off. On March 23, Aave processed its largest cluster of XAUT liquidations without disruption as gold prices moved sharply lower. RedStone presents this as evidence that tokenized bullion can function reliably as DeFi collateral when markets turn fast.

That liquidation episode landed after gold dropped around 10% over the prior week—its worst weekly performance in more than four decades. Earlier coverage linked the sell-off to what JPMorgan precious metals strategist Greg Shearer called an “extremely brutal flush,” reflecting heightened risk-off behavior and fast repricing in commodity markets.

Why DeFi use is lagging: the market is there, collateral is not

RedStone’s numbers point to a mismatch between trading interest and productive DeFi usage. Tokenized gold spot volume suggests there is plenty of demand to buy, sell, and exchange tokenized bullion exposure. But the amount actually locked or committed to decentralized lending stays relatively small—about $63 million across Aave v3 and Morpho.

That matters because lending protocols are where tokenized real-world assets can translate from “tradable exposure” into “composable financial infrastructure.” If only a tiny fraction of the token supply is being used as collateral, DeFi’s ability to scale tokenized assets—especially during periods of high volatility—remains constrained by capital deployment rather than technical viability.

RedStone also situates the findings within a broader RWA expansion. Gold is one component of a market that includes private credit and tokenized US Treasurys paired with equity-related structures. In June, Token Terminal reported the sector had topped $43 billion in value, underlining that tokenization momentum is visible beyond gold alone.

Gold’s macro headwind could cut both ways

Even though the DeFi collateral test showed operational resilience, the report arrives during a period when gold itself has been under pressure. Since peaking in January, gold futures have fallen more than 26%. RedStone attributes the decline to expectations of higher US interest rates—an environment that tends to weigh on non-yielding assets like precious metals.

For tokenized gold, that matters for two reasons. First, falling prices can increase liquidation activity in lending protocols; the March 23 event shows that this process can occur without disruption. Second, if rates remain elevated, investor demand for bullion exposure may fluctuate, influencing both the spot trading volumes and the willingness of lenders/borrowers to engage with tokenized collateral strategies.

At the same time, RedStone’s reporting implies that DeFi adoption hasn’t accelerated in proportion to the broader “tokenized gold” trading narrative. If gold volatility persists, investors may demand more robust collateral mechanisms—but the current deployment levels suggest that the industry still has work to do to turn resilience into sustained utilization.

Centralized exchanges may be moving faster than on-chain lending

While RedStone’s focus is on DeFi collateral usage, the report’s broader framing highlights a contrast: centralized platforms are increasingly integrating tokenized assets as they try to bridge traditional finance and digital assets. According to a CoinGecko report referenced in the article, an emerging “crypto TradFi” market had grown to $6.6 billion as of June.

This difference in pace helps explain the adoption gap. Tokenized gold can be actively traded on centralized exchanges without necessarily being locked into on-chain lending. Until more liquidity and integrations flow directly into decentralized collateral ecosystems, tokenized real-world assets may remain more of a trading product than a primary DeFi building block.

As the tokenized RWA market expands—both on-chain and off-chain—readers should watch whether DeFi collateral usage of XAUT and PAXG rises meaningfully beyond current levels. The March 23 liquidation test suggests protocols can handle stress, but the next key question is whether capital continues to move from spot trading activity into sustained lending and other decentralized use cases.