Aave is evaluating a governance proposal to exit six underutilized blockchains and simultaneously liquidate a number of underperforming asset markets. According to the proposal, the adjustments involve approximately $98 million in deposits, with the aim of reducing maintenance costs and mitigating operational risks.
Involving 6 chains and more markets
The chains slated for withdrawal include Sonic, Scroll, zkSync, Metis, Soneium, and Aptos. Simultaneously, Aave plans to delist low-adoption asset markets in 11 deployments and liquidate 21 expired Pendle principal token markets.
The proposal states that these six chains collectively account for less than 1% of Aave's total assets. Aave currently operates on approximately 23 chains, with total protocol assets of approximately $14 billion.
Quarterly revenue is lower than maintenance costs
The core reason given in the proposal is insufficient economic viability. All six deployments mentioned above generated less than $5,000 in quarterly revenue, with Metis, Soneium, and Aptos generating less than $1,000 per quarter.
Aave believes that such revenue levels are insufficient to cover ongoing operating costs, including oracle price feeds, liquidation system maintenance, and daily monitoring across various markets. In comparison, Aave earns over $142 million annually on the Ethereum mainnet, Base earns approximately $4.7 million annually, while Metis earns only about $3,000.
Significant capital outflow in the past 6 months
- Soneium deposits decreased by 95%.
- Aptos' available liquidity has decreased by 94%.
- zkSync's deposits decreased by 88% to approximately $844,000.
In addition, Scroll dropped 86% to approximately $2 million; Metis dropped 79%; and the largest, Sonic, also dropped 74% to less than $8 million.
Proposed freeze on new operation guidance exit
If the proposal proceeds, Aave will not force the liquidation of existing positions, but will freeze new deposits, new loans, and new collateralization operations in these markets, and will compress the supply cap and borrowing cap to 1 token.
The proposal also plans to direct 99% of borrowing interest to Aave Vault and introduce a 5% base borrowing rate to increase holding costs, prompting remaining users to close out their positions or migrate their accounts.
This rollback wasn't a sudden shift. Last December, the Aave Chan Initiative proposed withdrawing its zkSync, Metis, and Soneium deployments, arguing that these networks failed to demonstrate product-market fit. The article also mentions that Aave's total revenue in the second quarter had decreased to $156 million from $198 million in the first quarter.
