Aave, a leading lending platform, has successfully raised approximately $160 million to mitigate the $200 million in bad debt resulting from the Kelp DAO exploit, as reported by Arkham on Saturday. The blockchain analytics platform noted that the largest contributors, Mantle and Aave DAO, have together contributed $127 million, equivalent to 55,000 ETH.
This coordinated effort is part of a broader recovery initiative, known as DeFi United, aimed at stabilizing the DeFi markets following a $292 million security breach. The exploit, which occurred due to a vulnerability in the KelpDAO integration with LayerZero, resulted in the minting of 116,500 unbacked rsETH tokens, leaving Aave with impaired collateral and triggering a significant withdrawal of deposits.
To address this, Aave founder Stani Kulecho has personally contributed 5,000 ETH, valued at approximately $11,730,000, to support the DeFi United initiative, which seeks to restore confidence in rsETH and mitigate losses through a coordinated bailout.