Aave Adjusts Ethereum USDT Borrow Rate Curve

The substance here is risk management, not headline news: Aave is choosing to price scarce USDT liquidity more aggressively, which shifts the cost of tight conditions onto borrowers rather than the protocol's liquidity buffers. That matters most for leveraged USDT borrowers on Ethereum, who face earlier cost increases, while lenders gain from steeper rate response. The design choice to preserve accrued interest limits immediate disruption but leaves the outstanding balance path as the pressure point. Whether the steeper curve actually attracts liquidity back, or simply pushes borrowing demand toward other venues, is the open question.