Aave, a leading lending platform, has successfully raised approximately $160 million to address the $200 million in bad debt resulting from the Kelp DAO exploit, as reported by Arkham on Saturday. The largest contributors to this effort are Mantle and Aave DAO, who together have raised 55,000 ETH, equivalent to $127 million. Following a coordinated recovery effort announced last week by Aave and major crypto firms, the DeFi United initiative aims to stabilize DeFi markets after a $292 million security breach. Led by Aave service providers, the goal is to restore support for rsETH, the yield-bearing derivative token of ether at the center of the exploit.
Aave founder Stani Kulecho has personally contributed 5,000 ETH, valued at $11,730,000. The exploit, linked to a KelpDAO integration vulnerability with LayerZero, resulted in the minting of 116,500 unbacked rsETH tokens, impairing Aave's collateral and triggering a significant withdrawal of deposits.
The current effort focuses on stabilizing the system through a coordinated bailout to recapitalize rsETH and minimize losses.