Aave’s 16 September 2026 ARFC from LlamaRisk is a risk-parameter proposal, not a live increase in borrow power. The post would lift loan-to-value (LTV) and liquidation-threshold (LT) settings for ether and bitcoin collateral on Aave V3 Ethereum Core, Arbitrum, and Base, plus collateral factors on the Aave V4 Ethereum Main Spoke. Until Snapshot passes and an Aave Improvement Proposal (AIP) executes, the numbers in the Aave UI stay where they are.
I care about this because Aave is where a lot of real DeFi borrowing already sits, not because a forum thread is a new product. Show me the fee and the live parameter, not the roadmap. This thread has the math. It does not yet have the on-chain change.
As of the site CoinGecko snapshot at 2026-09-17T00:15:33+00:00, ether (ETH) was about $2,418.80 (24h +0.87%) and bitcoin (BTC) about $76,278 (24h +0.86%). Those prices are tape context. They are not a reason to treat the ARFC as extra leverage today.
What happened
On 16 September 2026 at 07:24 UTC, LlamaRisk published [ARFC] Revision of ETH & BTC Collateral Efficiency on Aave on the Aave governance forum. The author is a DAO-funded risk provider. The post is explicit about sequencing: gather feedback, then Snapshot, then an AIP.
The headline asks are large on Ethereum Core wrapped bitcoin. Current Core WBTC is 73.0% LTV and 78.0% LT, with a 5.00% liquidation bonus. The ARFC would move that reserve to 81% LTV and 85% LT. Coinbase wrapped bitcoin (cbBTC) on Core would make the same LTV/LT jump from 73.0%/78.0%, keeping its 7.50% bonus. Wrapped ether would only tick from 80.5%/83.0% to 81%/84%. wstETH would go from 78.5%/81.0% to 79%/82%, and weETH from 77.5%/80.0% to 78%/81%.
Arbitrum and Base are not a copy-paste of Core. On Arbitrum, WETH would move from 80.0% LTV to 81% LTV while LT stays at 84.0%. WBTC would move from 73.0%/78.0% to 78%/82%. On Base, WETH would go from 80.0%/83.0% to 81%/84%. Base cbBTC would go from 73.0%/78.0% to 81%/84%, and the liquidation bonus would fall from 7.50% to 6.00%, with the cbBTC stablecoin E-Mode moving from 80.0%/83.0% to 82%/85%.
On Aave V4’s Ethereum Main Spoke, collateral factor (the V4 cousin of LTV/LT) would move to 84% for WETH (from 83.0%), 82% for wstETH (from 80.0%), 81% for weETH (from 80.0%), and 85% for both WBTC and cbBTC (from 78.0%). LlamaRisk says those V4 moves should be a configuration update, not a new collateral listing.
Context
Aave documents LTV as the share of collateral value you can borrow, and LT as the line where liquidation can start. Those definitions live in Aave’s docs. Raising both lets a user borrow more against the same stack, and it leaves less cushion before a keeper can repay debt and seize collateral. That is why a 73/78 to 81/85 Core WBTC move is the part of this thread that actually changes user math, if it ever ships.
LlamaRisk sizes the new thresholds to a one-hour window. The post measures how long economically meaningful liquidations stayed underwater on Aave V3 Ethereum Core, Arbitrum, and Base from August 2025 to August 2026. Value-weighted, Core ETH liquidations (7,206 events, $618 million seized) had a median under one second and a 99th percentile around five minutes. Core BTC (2,621 events, $358 million seized) looks similar. At most 0.07% of processed value had been below its liquidation price for more than an hour.
Aave still caps a single liquidation call at half of outstanding debt, so a large position clears in a short sequence of calls. Across the February 2025 and October 2025 stress windows on Core, the value-weighted gap between consecutive calls on the same position had a median under one minute and a 95th percentile of 15 to 21 minutes. In February, Core seized $172 million with a 24-second median lag behind the triggering feed print. In October, Core seized $100 million with a 36-second median; 63% of that volume was inside one minute and 100% within five minutes. Dust positions dominate the slow tail: Core liquidations slower than five minutes were 11.1% of events but 0.23% of seized dollars.
February produced no recognized bad debt. October produced $0.39 million against about $128 million seized, with none of that deficit on the ETH- and BTC-family collateral under review. Two-year annualized volatility in the write-up is 68.8% for ETH and 44.4% for BTC. The 1-hour 99.9th percentile excursion is -11.85% for ETH and -5.09% for BTC. The residual case is a stalled oracle and liquidation pipeline coinciding with a move beyond that percentile. The realized worst one-hour prints in the record are -24.27% for ETH and -11.15% for BTC.
That is why the authors park ETH-family thresholds near the buffer implied by each reserve’s live bonus, and they park BTC settings deeper inside the buffer as a margin for depth, caps, and concentration that the price model does not capture. Base cbBTC is the exception on bonus: they cut it to 6.00% and cite about $33 million of stablecoin depth. Core keeps the 7.50% cbBTC bonus because a pending protocol-fee increase would otherwise cut the liquidator’s net share from both sides.
Usage is why this is worth a reaction. DefiLlama’s protocol endpoint showed about $14.77 billion of Aave TVL on Ethereum, about $487 million on Arbitrum, and about $501 million on Base when we read it at 2026-09-17T00:30:01Z. Aave V3 fee revenue on the same desk pull was about $1.14 million over 24 hours and about $8.19 million over seven days (api.llama.fi Aave V3 fees, 2026-09-17T00:30:01Z). L2Beat’s scaling summary, read at the same minute, put Base Chain total value secured near $14.32 billion and Arbitrum One near $10.72 billion. Those L2 totals are not Aave TVL. They are the neighborhoods this ARFC also touches. For how we timestamp a tape like this, see how to read a crypto market snapshot.
Our read
My stance: this ARFC is a calibration memo with a real Core WBTC jump inside it, and it is still not extra leverage. Anyone quoting 81/85 as the live Aave bitcoin collateral setting is reading a forum post as if it were an AIP execution. The next-steps paragraph on the thread is the whole story: feedback, then Snapshot, then implementation.
I also do not treat Core and the L2s as one trade. The Core WBTC move (eight points of LTV, seven points of LT) is the efficiency ask. Arbitrum WBTC only goes to 78%/82%. If the DAO later ships Core and stalls Arbitrum, that split will show up in borrow rates and in where leveraged basis trades sit. For ether, the proposed Core WETH change is one point of LTV and one point of LT. That is a rounding change next to the bitcoin collateral rewrite.
Falsifiable claim: by 23:59 UTC on 15 October 2026, either (a) an Aave Snapshot on this ARFC (or an AIP payload that cites it) is recorded as successful and includes Ethereum Core WBTC at 81% LTV and 85% LT, or (b) LlamaRisk or Aave Labs withdraws or restates those Core WBTC figures on the same thread. If an AIP or the Aave UI shows Core WBTC at 81%/85% before a Snapshot on this ARFC is recorded as successful, the “forum, then Snapshot, then AIP” sequencing read is wrong. If Snapshot fails and Core WBTC is still 73%/78% on 15 October with no replacement AIP, the “this is the live path for a bitcoin efficiency bump” half of the read is wrong.
I am not predicting ether or bitcoin prices from this. The Ethereum history and Bitcoin history pages are the place for cycle context. This piece is about whether Aave will let the same stack support more debt.
What to watch next
Watch the ARFC thread for Snapshot links and for any restatement of the Core WBTC 81/85 pair. If those two numbers move in a later edit, the leverage story changes even before a vote.
Watch AIP execution and the Aave UI, not screenshots of the forum table. LTV and LT are live only when the pool configuration matches the table. Until then, treat 73/78 as the Core WBTC setting.
Watch liquidation bonuses on Base cbBTC versus Core. A 6.00% Base bonus with a higher LTV is a different keeper payday than Core’s 7.50% bonus with a pending protocol-fee change.
Watch Ethereum news for a competing parameter path. A 1-point USDT optimal-usage tweak is not this story. A silent Core WBTC config update would be.