[AAVE] [ARFC] Safety Module & Umbrella Emission Update

Simple Summary

This proposal outlines the next incremental reduction in Safety Module emissions.

Motivation

The proposed changes aim to improve the capital efficiency of the Aave Safety Module while ensuring a smooth transition away from legacy staking modules. By phasing out stkAAVE and stkABPT through the reduction of slashing to 0%.

Specification

If approved and executed, this proposal will implement the following updates:

1. Reduce Slashing Risk

| SM Category | Current | Proposed | | -- |

• | -- | | stkAAVE | 10% | 0% | | stkABPT | 10% | 0% |

2. Reduce Cooldown Period

| SM Category | Current | Proposed | | -- |

• | -- | | stkAAVE | 20 days | 7 days |

3. AAVE/wETH Liquidity Funding

Create allowances to a new Aave Liquidity SAFE for the equivalent of $5M AAVE and $5M aEthWETH, sourced from the Aave Ecosystem Reserve and the Aave Collector on Ethereum.

• Asset: AAVE – 0x7Fc66500c84A76Ad7e9c93437bFc5Ac33E2DDaE9
  Amount: $5M USD equivalent
• Asset: aEthWETH – 0x4d5F47FA6A74757f35C14fD3a6Ef8E3C9BC514E8
  Amount: $5M USD equivalent
• Spender: Aave Liquidity SAFE – 0xAAA973Fe8A6202947e21D0a3a43d8E83ABE35C23
• Method: approve() on the Ecosystem Reserve (AAVE) and Collector (aEthWETH) to the Liquidity SAFE

The Liquidity SAFE signers follow the same configuration as other Asset SAFEs, requiring 3 of 4 approvals.

References

• Implementation: AaveV3Ethereum
• Tests: AaveV3Ethereum
• Snapshot
• Discussion

Copyright

Copyright and related rights waived via CC0.

https://app.aave.com/governance/v3/proposal/?proposalId=385