---

title: [ARFC] Safety Module - Reduce Emissions author: @TokenLogic created: 2026-03-02

---

Summary

The publication proposes implementing the AAVE Emission reduction as presented in the Aave DAO Funding Insights forum post.

Motivation

As outlined in the Aave DAO Funding Insights publication, the Aave DAO's buyback program has acquired over 205,000 AAVE (1.28% of total supply) in under a year, demonstrating the protocol's strong net acquisition posture. With the DAO acquiring AAVE faster than it distributes, there is a clear opportunity to further reduce Safety Module emissions while maintaining robust security coverage.

stkAAVE participation has remained stable through previous emission reductions, net inflows of +98,600 AAVE in January 2026 and +60,100 AAVE in February 2026 indicate that stakers are resilient to moderate yield compression. At 16.78% of total supply staked, the Safety Module maintains strong coverage well above the levels needed for protocol security.

Source: coming soon

Meanwhile, the Aave Finance Committee has deployed deeper Protocol-Owned Liquidity (POL) for AAVE/wETH, removing the dependency on rented liquidity via stkABPT emissions.

The combined 29,200 AAVE saved annually represents nearly 0.18% of total supply, a meaningful reduction in annual AAVE emissions, valued at $3,212,000 at $110/AAVE.

stkAAVE

stkAAVE Emissions have been progressively reduced

To accommodate the AAVE emission reduction, the Cooldown duration is reduced from 7 days to 2 days, making stkAAVE more liquid and suitable for various integrations such as CEX Earn programs and Future markets.

stkABPT

The Aave Finance Committee provided deeper AAVE/wETH liquidity following the implementation of the February 2026 - Funding Update. The Aave DAO can now proceed to reduce AAVE emissions to stkABPT holders, knowing that sufficient and reliable AAVE/wETH liquidity is available to support AAVE liquidations.

Specification

The tables below summarise the key amendments to the SM and the anticipated impact on depositors' yield.

Forward Looking Statement

TokenLogic will continue to monitor Safety Module participation and staker behaviour following these changes. If stkAAVE participation remains stable after the proposed emission reduction, further optimisations may be explored in future proposals.

The transition from stkABPT emissions to Protocol-Owned Liquidity marks a structural shift in how the DAO ensures market depth in the AAVE/wETH pools. The AFC's POL strategy provides permanent, protocol-owned liquidity at near-zero marginal cost. Its effectiveness will be closely tracked.

These changes are part of the broader set of recommendations outlined in the Aave DAO Funding Insights publication, which also covers buyback program adjustments, GHO liquidity strategy, and treasury management priorities for 2026.

Disclosure

TokenLogic is an active service provider to the Aave DAO, the beneficiary of stream 100072 and the KPI as outlined in this publication. The scope of this engagement is available via this forum proposal.

TokenLogic supports and maintains an independent delegate voting platform within the Aave community.

TokenLogic and associated entities have no undisclosed material conflicts of interest at the time of submission.

Next Steps

1. Gather feedback from the community.
2. If consensus is reached on this ARFC, escalate this proposal to the Snapshot stage.
3. If the snapshot outcome is YAE, escalate this proposal to the AIP stage.

Copyright

Copyright and related rights waived via CC0.