Aave Expands to Mantle Network as DAO Considers Multichain Deployments Shutdown

• Aave’s integration with Mantle provides access to advanced DeFi lending tools, boosting liquidity for institutional users.

• The move aligns with Mantle’s rapid TVL increase and focus on enterprise adoption in Layer-2 ecosystems.

• Aave’s governance proposes shutting down low-revenue chains like zkSync and Metis, with annualized revenues under $50,000, to prioritize profitability.

Discover Aave’s Mantle Network expansion and multichain consolidation strategy for efficient DeFi growth. Explore impacts on liquidity and protocol sustainability—stay informed on key crypto developments today.

What is Aave’s Expansion to Mantle Network?

Aave’s expansion to Mantle Network introduces its V3 lending protocol to this high-performance Layer-2 solution, enabling users to borrow, lend, and leverage major assets like ETH, USDC, and USDT. Announced on 2 December, this partnership aims to deliver institutional-grade liquidity at scale, supporting Mantle’s growth in total value locked (TVL) and user activity. By integrating Aave’s risk-managed pools and cross-chain features, the deployment strengthens lending markets for large capital providers in the DeFi sector.

How Does Aave’s Multichain Consolidation Strategy Work?

Aave’s governance process, through a recent Temp Check on its official forum, outlines a strategic reset to address underperforming deployments across multiple blockchains. The proposal identifies chains generating minimal revenue, such as zkSync, Metis, and Soneium, which collectively produce only $3,000 to $50,000 annually—insufficient to cover maintenance costs. These deployments face shutdown, allowing resources to shift toward profitable networks.

For mid-tier chains like Polygon, Gnosis Chain, BNB Chain, Optimism, Scroll, Sonic, and Celo, which fall below $3 million in yearly revenue, Aave plans to raise Reserve Factors. This adjustment increases protocol earnings from interest while monitoring performance over the next 12 months; failure to improve could lead to offboarding. Data from the proposal highlights Ethereum’s dominance, contributing 81.6% or $142 million in annualized revenue, underscoring the need for focused expansion.

Looking ahead, new deployments must meet a $2 million annual revenue guarantee, shifting the burden to partner chains and emphasizing economic viability over mere TVL growth. As noted by Aave governance contributors, this approach “ensures Aave’s multichain presence delivers tangible value,” drawing from internal analytics on user traction and operational overhead. This structured evaluation process, informed by protocol metrics, positions Aave to optimize its ecosystem amid DeFi’s competitive landscape.

Frequently Asked Questions

What Chains Will Aave Shut Down in Its Consolidation Plan?

Aave’s proposed shutdown targets zkSync, Metis, and Soneium due to their low revenue generation of $3,000 to $50,000 annually. This decision frees up engineering resources for higher-impact areas, as outlined in the governance Temp Check, promoting long-term protocol efficiency without affecting core Ethereum operations.

Why Is Aave Requiring $2 Million Revenue for New Deployments?

Aave is setting a $2 million annual revenue floor for new chain integrations to ensure deployments contribute meaningfully to the protocol’s sustainability. This policy, discussed in recent governance forums, prevents resource dilution on low-yield networks and aligns expansions with financial goals, benefiting token holders through improved profitability.

Key Takeaways

• Mantle Integration Boosts Liquidity: Aave’s launch on Mantle enables institutional users to access V3 features like isolated pools and cross-chain bridging, enhancing DeFi efficiency in Layer-2 environments.
• Consolidation Targets Efficiency: By closing underperforming chains and raising Reserve Factors, Aave reduces costs and focuses on revenue leaders like Ethereum, which accounts for over 80% of earnings.
• Future Expansions Demand Viability: The $2 million revenue requirement for new deployments ensures only economically sound partnerships proceed, signaling a mature approach to multichain growth in DeFi.

Conclusion

Aave’s expansion to Mantle Network alongside its multichain consolidation strategy reflects a balanced path forward for the leading DeFi lending protocol, prioritizing institutional liquidity while enforcing fiscal discipline across deployments. By shuttering low-revenue chains and mandating revenue thresholds, Aave demonstrates resilience in a maturing crypto market. As Layer-2 ecosystems evolve, this strategic pivot positions Aave for sustained innovation—investors and users should monitor governance updates for ongoing developments in DeFi infrastructure.