Aave V4 deposits hit record $806M after 30% weekly rise

Aave V4 deposits have reached a record $806 million after climbing 30% over seven days, while active loans have increased to $206 million.

Aave V4 deposits accelerate past $800 million

Aave’s on-chain dashboard shows that V4 deposits reached $806 million on Aug. 27, extending a rapid rise that began earlier in the month. Deposits passed $500 million on Aug. 19 and exceeded $600 million two days later before adding more than $200 million over the following six days.

Within the total, V4 deposits on Ethereum passed $500 million on Aug. 25. The dashboard divides the capital among several markets with separate collateral rules, borrowing limits, and risk settings instead of placing every asset inside one common lending pool.

Ethereum Core is the largest market, holding $378 million, or about 47% of all V4 deposits. EtherFi Cash on Optimism follows with $257 million, giving the two markets a combined $635 million and nearly 79% of the version’s deposits, based on figures from the dashboard.

Among the remaining markets, Ethereum Global Dollar holds $75 million, and Ethereum Prime accounts for $63 million. Avalanche Core has attracted $18 million, while Ethereum Plus holds another $15 million. Combined, the six listed markets account for the full $806 million reported on the dashboard.

The latest figures have placed V4 well above the $400 million level reported in mid-August. Deposits had stood near $350 million at the start of the month, meaning the value supplied to the system has more than doubled in less than four weeks.

Active loans reach $206 million

Borrowing has risen alongside deposits, with active V4 loans reaching $206 million. EtherFi accounts for $62 million of the total as users deposit wrapped EtherFi staked Ether, known as weETH, as collateral to borrow wrapped Ether.

According to the dashboard, the EtherFi market has reached a utilization rate of 92%. Utilization measures the portion of deposited assets currently being borrowed, making the figure important for both lenders and borrowers. High utilization can increase returns for suppliers, but it can also raise borrowing costs and leave less immediately available liquidity for withdrawals.

A recent crypto.news report on Aave’s debt concentration found that Ether staking and restaking tokens, including weETH, rsETH and wstETH, made up about 66.2% of collateral among the protocol’s largest leveraged positions. WeETH alone accounted for roughly 42%, while WETH represented about 73% of the debt held by that group.

The report also found that 9% of positions carried roughly half of Aave’s total debt. Average health factors for the group stood near 1.06, while debt-to-equity ratios were close to 10.7 times, according to the analysis. A health factor below 1 can trigger an automatic liquidation under Aave’s rules.

Such figures cover Aave’s lending system beyond the new V4 markets and therefore should not be treated as a direct measure of V4 risk. Still, they provide context for the 92% utilization recorded in the EtherFi market, where weETH collateral supports borrowing in the closely related WETH asset.

WeETH leads Aave V4’s deposit mix

WeETH is also the largest individual asset supplied to V4, with deposits of $97 million. The Global Dollar stablecoin, or USDG, ranks second at $90 million, followed by WETH and USDC at $81 million each.

Liquid staking and yield-bearing assets account for several other large positions. LiquidETH holds $77 million, while liquidUSD accounts for $58 million. Wrapped Bitcoin deposits have reached $54 million, giving users another crypto asset that can be deployed under V4’s market-specific collateral settings.

The seven named assets together represent $538 million, or about two-thirds of all V4 deposits. Other supported tokens make up the remainder of the $806 million total.

V4’s structure separates its markets into liquidity hubs and specialized spokes. Hubs manage supplied capital and accounting, while spokes set the terms for individual borrowing markets, including which collateral can be used and how much users can borrow.

The design differs from Aave V3, where each market generally operates as its own pool. V3 still holds approximately $31 billion in deposits, nearly 38 times the amount recorded in V4. The comparison shows that most Aave capital remains in the older system even as deposits move into the new version.

During the Aave V4 launch in April, the protocol presented the hub-and-spoke model as a way to create lending markets with tailored risk controls without dividing liquidity across entirely separate pools. Supported uses included fixed-rate loans, tokenized real-world asset collateral, and structured credit.

Aave’s DAO had previously approved $25 million in stablecoin funding and 75,000 AAVE tokens for protocol development. The funding framework established V4 as the system’s long-term technical base while directing revenue from specified Aave Labs products to the DAO treasury.

Avalanche adds a U.S. Treasury lending route

Outside Ethereum and Optimism, Avalanche Core accounts for $18 million of current V4 deposits. Aave launched V4 on Avalanche in July, making the network its first V4 deployment beyond Ethereum.

As reported in July, Aave said the Avalanche rollout would support lending markets backed by tokenized real-world assets. Planned collateral included tokenized U.S. Treasuries, money market funds, private credit and corporate bonds.

The planned Treasury-backed markets provide a direct connection to U.S. financial assets, although on-chain access does not by itself determine whether a product can legally be offered to U.S. investors. Any access rules would depend on the issuer, the structure of the tokenized instrument, and the regulations applying to its distribution.

Avalanche’s deployment also sits alongside an effort to reduce support for markets with little activity. In July, an Aave governance proposal targeted six deployments and dozens of low-use reserves covering about $98.1 million in supplied assets and $15.6 million in debt.

The proposal called for retiring deployments on Sonic, Scroll, zkSync, Metis, Soneium and Aptos while removing 50 low-adoption reserves and 21 matured Pendle principal tokens from other markets. Under the proposed process, Aave would first freeze affected reserves and cut their supply and borrowing caps before gradually reducing the remaining positions.