Aave V4 Deposits Hit $806 Million as EtherFi Cash Rises

Deposit growth breaks records

Aave’s onchain dashboard showed user deposits in version 4 (V4) reaching $806 million. This amount marks a new high for the newer version. Deposits climbed about 30% in one week.

The fast rise started earlier in August. Aave announced that V4 deposits passed $500 million on August 19. They hit $600 million on August 21 and then crossed $800 million six days later. Deposits specific to Ethereum also passed $500 million on August 25.

Where the money is going

The second-largest market on V4 is EtherFi Cash. It currently holds $257 million in deposits. The market also supports borrowing. There are $216 million in active loans on V4 overall.

In the EtherFi market specifically, there is $62 million in active loans. This market allows users to borrow WETH (Ether wrapped for use on blockchains) using weETH as collateral. The utilization rate, which shows how much of the available money is being borrowed, stands at 92%.

Deposits are spread across Ethereum, Optimism, and Avalanche. The largest pool is Ethereum Core with $378 million. Other major pools include Ethereum Global Dollar at $75 million and Ethereum Prime at $63 million.

The older version stays dominant

While V4 is growing quickly, the older version 3 (V3) is still much larger. The V3 dashboard lists $31 billion in deposits. Ethereum Core on V3 alone holds $25 billion.

The two versions handle liquidity differently. According to Aave’s documentation, V4 uses a hub-and-spoke system. This means one central hub manages the money and accounting, while different spokes handle their own borrowing rules and risk limits for specific markets.

Market targets and outlook

On August 27, data provider TokenLogic said the EtherFi Cash market had been running for two weeks. The market is working toward a target of $500 million in lending capacity.

• The Defiant