Aave's stablecoin stress test resolves cleanly — rates back to 3.86% with zero market spillover.

Aave V3 USDC borrowing rates have normalised to around 3.86% following a sharp spike triggered by whale withdrawals in the wake of a recent exploit. The crisis drained stablecoin liquidity from Aave's pools, briefly forcing traders to borrow stablecoins against their own stablecoin collateral — an unusual and costly loop. Ecosystem participants ultimately raised over $160 million in relief funding, and Aave governance proposed targeted liquidity measures that helped restore order.

Tesseract Group head of asset management Adam Haeems, overseeing $500 million in AUM, noted that Morpho's curated vaults now sit in the 3.5%–5.4% range and Sky's USDS savings rate is around 3.65%. More significantly, the entire rate cycle — spike, fix, normalisation — ran independently of Bitcoin's price action, with no cross-market contagion.

For institutional allocators, that decoupling is the real signal…