Aave Community Proposes WBTC Delisting to Mitigate Risks

According to Odaily, Aave community member LlamaRisk has initiated a proposal to delist Wrapped Bitcoin (WBTC) from the platform. The proposal includes several key measures aimed at reducing the risks associated with WBTC. Firstly, the proposal suggests lowering the Loan-to-Value (LTV) ratio for all V3 instances, including Ethereum, Arbitrum, Avalanche, Harmony, Optimism, and Polygon, to zero. This measure is intended to prevent additional borrowing using WBTC as collateral, without affecting the positions of existing users. Additionally, the proposal recommends reducing the supply and borrowing caps to levels 5-10% higher than the current utilization rates. This step aims to limit the additional risk posed by WBTC while allowing users the flexibility to adjust their positions as needed.