Two Markets, One Liquidity Source
In V4, users interact with borrowing modules called spokes. Those modules send deposits to a hub and draw loans from it, while maintaining separate collateral settings and limits. Aave’s documentation describes this as a change from V3’s market-per-pool design: connected markets can use shared liquidity rather than each needing a separate deposit base.
Arc launched with one Core Hub and two borrowing markets. All four launch assets are borrowable in Main; Forex is limited to $USDC and $EURC. Separate supply-only tokenization spokes turn deposits into positions that external vaults and aggregators can use, without enabling borrowing through those integrations.
The launch configuration adopted LlamaRisk’s token-denominated supply and borrowing limits. For Main, those were 56 million $USDC supplied and 51 million borrowed; 20 million $EURC supplied and 18 million borrowed; 1,100 cirBTC supplied and 220 borrowed; and 24,000 WETH supplied and 4,800 borrowed.
Forex’s initial limits were 13 million $USDC supplied and 11 million borrowed, plus 10 million $EURC supplied and 9 million borrowed. LlamaRisk cited limited secondary-market liquidity for $EURC as the reason for conservative Forex caps. These are launch limits, not a current reading of remaining capacity.
Ethereum’s V4 deployment also uses shared hub liquidity and has a Forex Spoke listed in Aave’s contract directory. The Defiant previously reported on Arc’s contribution to V4’s September growth.
Arc also carries network-level controls relevant to borrowers. In its prelaunch technical assessment, Aave Labs said $USDC is Arc’s gas asset and an issuer freeze can stop an address transacting altogether. Its tests found that a frozen borrower’s position could still be repaid or liquidated by a third party.
