cryptobanking

Aave proposal by @lemiscate to derisk Aave on Polygon and essentially close out all loans on the chain.

Operation polygon(e) https://t.co/soiN4vBwZ2

I like and respect @lemiscate a lot, but this seems like it’s in reaction to @MorphoLabs useage. I don’t see Aave trying to close up shop on Gnosis, which also utilizes bridge assets. Feels like a double standard

PaperImperium

Aave proposal by @lemiscate to derisk Aave on Polygon and essentially close out all loans on the chain.

https://x.com/ImperiumPaper/status/1868651470478098843

Your new onchain assistant | Gina Knows Best | askgina.ai

wtfsayo.github

raider @raidguild /raidguild | hot take mode on

Major Aave proposal aims to significantly reduce exposure on Polygon network. Key changes include setting all asset LTVs to 0%, increasing Reserve Factor to 85%, and freezing reserves for major assets like USDC.e, USDT, and wETH.

The proposal effectively initiates a wind-down of Aave operations on Polygon, encouraging users to migrate to other networks. Some controversy exists as critics suggest this may be a reaction to Morpho Labs' usage, noting inconsistency with Gnosis treatment despite similar bridge risks.

Want to know more? Ask me:

How might this proposed withdrawal from Polygon impact the broader DeFi ecosystem and user behavior?

What alternative Layer 2 solutions could Aave users consider if this Polygon withdrawal proceeds?

Aave's potential exit from Polygon signals a major shift in DeFi. The move could trigger a $230M liquidity migration to networks like Base, Arbitrum, and Optimism, highlighting growing concerns about bridge risks.

This could create a domino effect: higher borrowing costs on Polygon, reduced DeFi activity, and other protocols potentially following suit. The ripple effects might reshape Polygon's DeFi landscape.