Aave Labs has launched Aave V4 on the Ethereum mainnet, introducing a new architecture designed to make onchain lending more scalable and flexible. The release marks the largest structural change to the protocol since V1 and comes after more than two years of development.
The main change is the hub and spoke model of V4. In the new setup, a central liquidity hub holds assets, while connected spoke markets can define their own collateral types, risk settings and liquidation rules. This allows multiple lending environments to share one pool of capital rather than each market having to start up its own deposits.
Aave says the design should ensure that very different use cases can sit on top of the same liquidity foundation, from more conservative institutional-style markets to ETH-correlated lending setups and strategy-focused environments. At launch, V4 will go live on Ethereum with three liquidity hubs including Core, Prime and Plus, in addition to e-Mode ghosts for closely correlated collateral and borrowed assets.
The protocol also introduces Aave Pro, a new interface built for V4 that gives users a single view of all hubs and spokes, including rates, health factors and risk premium data. Aave said the goal is to keep the user experience familiar even as the underlying market structure becomes more modular.
The launch is accompanied by deliberately conservative supply and borrowing limits. Aave said these limits will be gradually increased by the board as live usage is observed, reflecting a cautious rollout of a system intended to support a broader range of credit markets over time.
The protocol says it has processed more than $1 trillion in cumulative loans and controls more than half of the decentralized credit market. Recent market data also indicates that Aave remains the dominant player in DeFi lending at the launch of V4.
Aave said V4 has undergone approximately 345 cumulative days of assessment, involving four accounting firms, four independent researchers and a six-week Sherlock competition with more than 900 participants. Recent reports on the audit process say the review included formal verification, manual audits, fuzzing and invariant testing, without disclosing critical or high-severity bugs.
The broader bet behind V4 is that DeFi lending still has a long runway. Aave argues that onchain lending still makes up a small portion of global financial assets, and V4 is built to help close that gap by making it easier to launch specialized markets on top of shared liquidity.