Borrowing kink lowered to 92%, Aave adjusts USDT interest rate parameters for Ethereum Core market
Aave has executed an adjustment to the USDT borrowing interest rate parameters in the Ethereum Core market at block height 26,241,799, lowering the rate kink from 94% utilization to 92%, so that borrowing costs rise earlier when liquidity in the pool tightens. The new parameters are: optimal utilization 92%, base rate 0, slope 1 at 4.5%, slope 2 at 10%; the kink rate is 4.5% APR, and at 100% utilization it is 14.5% APR. At 94% utilization, the old curve's borrowing rate is 4.5% APR, while the new curve's is 7% APR, 2.5 percentage points higher. LlamaRisk recommended the adjustment on October 20; based on a supply of 2.8922 billion USDT, 92% utilization leaves about 57.84 million USDT more in unborrowed buffer than 94%. This buffer does not represent actual cash, and withdrawals still depend on available unborrowed liquidity. A snapshot on October 23 showed that actual cash in the pool was about 391.4 million USDT, the variable borrowing APR was about 4.23%, and the supply liquidity APR was 3.29%.
