Aave governance has opened a proposal to whitelist new CoW-powered swap adapter factories as approved flash borrowers across a set of Aave V3 markets. If passed, the change would allow those factories to use flash liquidity without paying the usual flash loan fee on the approved path.
The proposal, listed as Aave proposal #542, covers adapter factories used for collateral swaps, debt swaps, repay-with-collateral flows, and leverage routes. It also calls for removing the older CoW Swap Adapter contract from the same instances where the new setup would be approved.
What the proposal changes
The plan asks the Aave DAO to register new Aave swap adapter factory contracts through ACLManager.addFlashBorrower on the relevant Aave V3 deployments. In practice, that would mark the factories as approved flash borrowers and exempt them from flash loan premiums when they access flash liquidity through that route.
At the same time, the proposal would revoke the prior CoW Swap Adapter contract’s approved status on the same markets by calling ACLManager.removeFlashBorrower. The payload is therefore designed to both add the new factories and phase out the earlier adapter contract where applicable.
Why Aave says the change matters
According to the proposal, Aave’s swap adapters are used inside the protocol experience for collateral swaps, debt swaps, repayments with collateral, and leverage. When one of those routes depends on flash liquidity, the flash loan premium is currently built into execution, which raises the cost of those transactions.
The proposal argues that whitelisting the new CoW Swap Adapter factories would remove that extra cost across the covered Aave V3 instances and extend the fee-free treatment to the new leverage adapter. As described in the governance post, routes that rely on flash liquidity would then execute without a flash loan fee, improving pricing for collateral swaps, debt swaps, and leverage operations on those markets.
Factories and markets in scope
Two factory versions are included: AaveV3AdapterV3Factory and AaveV3AdapterV4Factory. Each version serves its own group of CollateralSwap, DebtSwap, RepayWithCollateral, and Leverage adapters.
The proposal lists Ethereum Core, Ethereum Prime, Base, Arbitrum, Gnosis, Avalanche, BNB Chain, Polygon, Linea, and Plasma as the Aave V3 instances in scope. Both factory versions are listed for Ethereum Core and Base, while the other named markets in the specification include a V3 factory entry and do not list a V4 factory address. The previous CoW Swap Adapter contracts to be removed are also enumerated on a per-market basis, including Ethereum Core, Base, Arbitrum, Gnosis, Avalanche, BNB Chain, Polygon, Linea, and Plasma.
Process and next confirmed step
Aave Labs said it is presenting the proposal in its role as a service provider to the Aave DAO and within its approved scope of work. The governance post frames the current action as a request to authorize the contract registrations and removals described in the specification.
If the proposal receives support, the stated next step is to advance it as an AIP vote and, if that vote passes, execute the payload actions on the relevant Aave V3 deployments. Until then, the fee exemption and adapter changes remain proposed rather than active.
Source: governance.aave.com