[ARFC] Liquidation Protocol Fee Increase for WBTC, WETH, and wstETH on Aave V3 Ethereum Core

LlamaRisk has proposed raising the Liquidation Protocol Fee (LPF) from 10% to 20% on WBTC, WETH, and wstETH collateral on Aave V3 Ethereum Core, based on a backtest of 14,006 liquidation events (~$1.05B seized collateral) through the Chainlink SVR era. The change is estimated to have added $1.35M–$2.23M per year in net treasury revenue with no measurable bad debt, lifting Aave's take per dollar liquidated from ~173 bps to 187–196 bps. LlamaRisk recommends against going higher or broader, treating 30% as a hard ceiling because elevated fees risk suppressing marginal liquidations, and the proposal would proceed to Snapshot and AIP if community consensus is reached.