Aave proposes to hardcode Ethena's USDe price to anchor USDT, sparking community doubts

The Aave community recently launched a new ARFC proposal, proposing to hardcode Ethena's USDe price to match the USDT in the Aave price feed. The proposal was co-authored by Chaos Labs and LlamaRisk and submitted on January 3, aiming to protect Aave users from secondary market fluctuations. It is worth noting that LlamaRisk is a member of the Ethena Risk Committee. The proposal reads as follows: "By linking the value of USDe directly to USDT, we align the sUSDe oracle with USDT pricing, ensuring seamless integration and avoiding interruptions caused by short-term fluctuations in USDe prices." Aave currently uses Chainlink's USDe/USD price information to evaluate pledged USDe (sUSDe), which is a pledged version of USDe. Earlier news, According to the proposal, a 5% drop in USDe prices may put more than $300 million worth of USDe-backed loans on Aave at risk of liquidation, which may trigger a sell-off of collateral to repay outstanding debts. The proposal states: “To mitigate the risks associated with a USDe depegging event, we propose to hardcode the price of USDe to USDT.” The proposal has raised skepticism among Aave users, who question whether the approach addresses the underlying risks. “Given that USDe is not really intended to be a stablecoin, hardcoding the price of USDe to the price of USDT sounds a bit risky,” user Hazbobo noted. “What are the corner case risks involved? What is the worst case scenario?” Another community member, ElliotNess, criticized the proposal for failing to address potential risk factors: “This is a disappointingly low-quality ARFC from two service providers that does not delve into any potential conflicts…Frankly, the same can be said for every non-hardcoded asset listed on the Aave protocol.” ElliotNess questioned the rationale behind pegging USDE to USDT and suggested that if Aave plans to hardcode the price of USDe, it might as well peg it directly to $1.00 to avoid secondary market price deviations altogether. The proposal is in the early stages of discussion and has not yet been put to a formal vote. (Cointelegraph) Ethena Labs founder Guy Young posted a photo of a discussion with Aave founder Stani on X, and said: "Aavethena is a good proof of concept, and Arcthena will expand the scale of DeFi by 10 times." In response, a user below asked about the relevant time schedule, and Guy's answer was within 1-3 months.