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Aave leads DeFi "patching" stop-loss, due to KelpDAO being hacked for $292 million in a chain reaction

By: rootdata|2026/04/24 08:42:01
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Aave, in collaboration with multiple institutions, has launched the "DeFi United" rescue plan to address the approximately $292 million loss caused by the KelpDAO vulnerability attack and to prevent the spread of bad debts.

The attack originated from a vulnerability in the LayerZero integration, where hackers forged uncollateralized rsETH and borrowed approximately $190 million in assets on Aave, leading to collateral distortion and triggering a bank run, causing the platform's TVL to evaporate by about $10 billion at one point.

Currently, Lido Finance, EtherFi, and founder Stani Kulechov have proposed funding plans; Arbitrum has frozen some funds, but the remaining assets have been transferred through THORChain, making recovery difficult. The current focus is on joint funding to "patch the holes" and stabilize the DeFi lending system.

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