Aave Still Reeling From KelpDAO Hack Months Later

Aave, one of the largest lending and borrowing protocols in crypto, is still reeling from the April 18 hack of KelpDAO. The value of all crypto assets in its smart contracts has dropped 43% since the attack, with a current total of $14.9 billion, down from $26.4 billion just before the hack.

The North Korean hackers behind the KelpDAO theft exploited Aave's acceptance of KelpDAO tokens as collateral for loans, leaving Aave nursing a significant loss. Despite Aave's own report stating that its contracts, oracles, and liquidation mechanics worked as designed, the attack resulted in an estimated $246 million of bad debt for Aave and fellow lender Compound.

The dollar value of Aave's liquidity pools never recovered from the hack, and it still sits two-thirds below its October peak. The token price has also struggled, currently trading near $89, slightly below its pre-hack level.