News linked to both this project and an event.
LlamaRisk disclosed that Aave is unfreezing markets frozen due to the Binance hack in four phases. The v3 frozen reserves have already been unfrozen, while hacker-held assets such as USDT and USDC cannot currently be used for new borrowings against collateral.
Odaily Report: LlamaRisk posted on the governance forum stating that after the attack on Binance's Ethereum hot wallet, LlamaRisk, Aave Labs, and others decided to have the guardian freeze markets across the network, freezing a total of 175 reserve types across 16 networks covered by Aave V3, as well as 117 reserves across four spoke categories in Aave V4. Aave will continue to monitor the attacker's wallets and price feeds, and once fund flows cease, it will coordinate with all parties to unfreeze in phases.
Aave risk service provider LlamaRisk has released an incident report: On April 18, 2026, the attacker exploited a vulnerability in Kelp’s LayerZero V2 Unichain-to-Ethereum rsETH routing (a 1-of-1 DVN configuration flaw), forged inbound packets, and illicitly released 116,500 rsETH from the Ethereum-side adapter. Of these, 89,567 rsETH were deposited as collateral into multiple Aave V3 markets—including Ethereum Core and Arbitrum—enabling the borrowing of approximately 82,650 WETH (valued at ~$191 million) and 821 wstETH. Currently, only 40,373 rsETH remain in the adapter, while the total claimable rsETH on the remote chain stands at 152,577—creating a substantial shortfall. Depending on the loss allocation methodology, Aave faces two potential bad-debt scenarios: - Scenario 1 (global pro-rata allocation): Estimated bad debt of ~$123.7 million, with Ethereum Core bearing the greatest pressure; - Scenario 2 (loss confined to L2s): Estimated bad debt of ~$230.1 million, with Mantle facing a WETH reserve shortfall of up to 71.45% and Arbitrum facing a 26.67% shortfall. Following the incident, Aave Protocol Guardians and Risk Administrators immediately froze rsETH/wrsETH reserves across all 11 affected markets.