A recent $292 million exploit on April 18 has not deterred the decentralized finance (DeFi) sector, according to Standard Chartered, with the bank describing it as 'bent, not broken'. The attack on KelpDAO had a ripple effect on AAVE, the largest DeFi lender, after stolen tokens were used as collateral for other assets, triggering a sharp liquidity crunch. This resulted in a 38% drop in deposits and a 31% decrease in active loans, characteristic of a bank-run scenario. Despite this, Standard Chartered still expects tokenized real-world assets to reach a $2 trillion market cap by the end of 2028, driven by growth in DeFi lending and stablecoin liquidity.
According to Geoff Kendrick, head of digital assets research, 'We still project that tokenised real-world assets (RWAs) will reach a market cap of $2 trillion by end-2028, up from $35 billion in October 2025.' Hacks and exploits remain a significant risk in the crypto space, undermining trust in systems built on code rather than intermediaries. The complexity and interconnected nature of blockchain infrastructure amplify these risks, with cross-chain bridges expanding functionality but also increasing the attack surface. Repeated exploits can erode confidence across the ecosystem, pushing users and institutions to the sidelines and potentially leading to tighter regulation and slowed adoption.
In response to the exploit, AAVE and a coalition of DeFi firms committed over $300 million to stabilize the system, which helped normalize conditions, with yields easing and deposits recovering. The incident has also accelerated structural upgrades, including AAVE's V4 upgrade and the forthcoming Ethereum Economic Zone, aimed at reducing reliance on cross-chain bridges, a frequent target in major crypto hacks.