According to @cas_abbe, Aave and other lending protocols assume 1 stETH equals 1 ETH for collateral purposes because users can ultimately redeem stETH for ETH after a waiting period (source: @cas_abbe on X). According to @cas_abbe, stETH often trades at a slight discount to ETH in secondary markets, creating a stETH/ETH basis that diverges from the 1:1 collateral assumption (source: @cas_abbe on X). According to @cas_abbe, this market discount is the second key reason in his analysis and is relevant for traders evaluating borrowing power and potential liquidation dynamics when using stETH as collateral (source: @cas_abbe on X).

According to @jessepollak, the Base economy has reached an all-time high of over $1 billion in active loans, signaling significant momentum within the DeFi sector (Source: Twitter/@jessepollak, June 8, 2025). This surge in lending activity on Base highlights robust user engagement and increasing liquidity, which are likely to attract further institutional and retail interest. For traders, this milestone suggests heightened on-chain activity, potentially leading to increased volatility and trading opportunities across Base-native tokens and broader DeFi assets.

According to @jessepollak, onchain lending is experiencing a significant surge in activity on the Base network, with rapid user adoption and increasing transaction volumes reported (source: Twitter, May 3, 2025). Traders should monitor emerging lending protocols on Base for potential liquidity opportunities and yield variations, as the influx of users may influence token prices, lending rates, and collateral dynamics across decentralized finance platforms.