🌟 Warning: Aave lost $5.4 billion in ETH in a short time! 🌟 The rsETH exploit on Kelp DAO triggered a powerful domino effect. The attacker exploited Kelp DAO to generate bad debt directly on Aave → causing whales to panic and flee en masse. 👉 Aave, the largest DeFi bluechip by TVL, is now facing its most severe liquidity withdrawal ever. This is being viewed as an ecosystem-level Black Swan event, with potential to spread to EigenLayer and the entire LRT ecosystem. Immediate impacts: ✅ AAVE token: Strong selling pressure, down 16% in just the past 24 hours. ✅ ETH: Increased selling pressure as ETH is being withdrawn en masse from Aave. ✅ LRT & re-staking narrative: Full confidence in the restaking story (rsETH, Kelp DAO, EigenLayer, etc.) has been severely shaken. ✅ Overall DeFi market: Rising fear and risk-off sentiment; TVL of other lending protocols may also face withdrawals due to domino effects. 👉 If you’re holding Aave, stay vigilant and act appropriately.
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