Key facts
- Aave plans to abandon six blockchains: Sonic, Scroll, zkSync, Metis, Soneium, and Aptos.
- The affected chains hold a combined $13 million in deposits against Aave's $14 billion total.
- These six deployments collectively generate less than $5,000 in quarterly revenue each.
- The cost of maintaining these markets exceeds the revenue generated.
- Aave will freeze new activity and make borrowing prohibitively expensive on these chains.
Aave, a leading decentralized lending protocol, is considering a proposal to discontinue operations on six underperforming blockchains: Sonic, Scroll, zkSync, Metis, Soneium, and Aptos. This strategic move is driven by economic realities, as these chains collectively account for less than 1% of Aave's approximately $14 billion in total assets and generate minimal revenue, far below the costs associated with maintaining them.
Each of the six deployments currently brings in less than $5,000 per quarter, with Metis, Soneium, and Aptos earning under $1,000 each. These figures do not cover essential operational costs such as maintaining price feeds, liquidation systems, and market monitoring. In contrast, Aave's Ethereum mainnet deployment generates over $142 million annually, and its Base deployment yields about $4.7 million per year.
Deposits on these six chains have seen substantial declines over the past six months, with Soneium falling 95% and Aptos liquidity dropping 94%. The combined deposits on these chains total approximately $13 million. Aave's overall revenue model sees it retain about 13% of collected interest, amounting to roughly $117 million in the past year. However, the protocol's share from these six chains is trivial, barely covering the cost of a dinner.
The proposal suggests freezing these markets to new activity and making borrowing prohibitively expensive. This would encourage existing users to voluntarily unwind their positions. Existing positions would not be forcibly closed, but supply and borrowing limits would be drastically reduced, with 99% of borrower interest routed to Aave's treasury and a 5% base borrowing rate introduced.
This initiative aligns with a previous proposal from the Aave Chan Initiative in December, which suggested rolling back deployments on zkSync, Metis, and Soneium due to a lack of product-market fit. The initiative also pushed for a rule requiring any future deployment to commit to at least $2 million in annual revenue. Aave is framing this cleanup as both a cost-cutting and risk-reduction measure.