The total value held in one of the most trusted decentralized lending platforms in crypto is falling after hackers successfully attacked a third-party cross-chain staking protocol.
According to LookonChain, Aave has done just that to attest Its TVL value fell by $6.28 billion in less than 48 hours after KelpDAO’s LayerZero-powered cross-chain bridge was hacked and about $292 million of its rsETH token was minted out of thin air.
“Due to KelpDAO exploiter borrowing over 82,600 ETH ($195 million) from Aave Using rseth As collateral, bad debts appeared on Aave.
Many whales have withdrawn money from AaveWhich led to a decrease in the value of TVL from $26.396 billion to $20.114 billion, a decrease of $6.28 billion.
Major withdrawals include:
• MEXC withdrew $431 million
• Whale 0x7CD0 (possibly linked to Nonco) withdraws $405.7 million
• Abraxas Capital withdrew $392 million
Aave itself was not hacked, but the protocol is now exposed to significant bad debt from rsETH collateral that is now worthless.
Aave quickly froze the rsETH markets on V3 and V4 to prevent further borrowing/deposits, and the team says it is now exploring ways to make up any shortfalls.
Follow us on X, Facebook and cable
Never miss a beat – Subscribe Get email alerts delivered directly to your inbox
browse Hodel’s daily mix
 
Disclaimer: The opinions expressed in The Daily Hodl are not investment advice. Investors should conduct due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please note that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the purchase or sale of any assets including cryptocurrencies, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Generated image: mid-flight
