Aave

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Some illiquid altcoins will have their borrow limit reduced by upwards of 99%.

cointelegraph.com

Compound Finance to impose lending caps in light of failed Aave exploit

Community members of lending and borrowing platform Aave (AAVE) are submitting a governance proposal in the wake of an unsuccessful attempt to exploit the decentralized finance (DeFi) protocol.
According to the AAVE community, a wallet with the address “0x57e04786e231af3343562c062e0d058f25dace9e” borrowed a massive amount of Curve DAO Token (CRV) on AAVE using $40 million worth of USD Coin (USDC) as collateral, with the end goal being to short CRV.

The proposal, authored by DeFi risk management platform Gauntlet and protocol engineering developer Llama, says,
“Over this past week, the user 0x57e04786e231af3343562c062e0d058f25dace9e opened a short position on CRV using USDC as collateral. At its peak, the user was shorting ~92 million units of CRV (roughly $60 million USD at today’s prices).”
The exploit attempt was foiled, but AAVE sustained bad debt because of slippage.
“The attempt to short CRV on Aave has been unsuccessful, and the user lost ~$10 million USD from the liquidations. The user has been fully liquidated, but despite this, Aave has accrued a much smaller (~$1.6 million USD) bad debt position as of today’s CRV price.”
The proposal calls for the use of Gauntlet’s insolvency refund and the Aave Collector Contract to cover the excess debt, which is isolated to the CRV market.
“While this is a small amount relative to the total debt of Aave, and well within the limits of Aave’s Safety Module, it is best practice to recapitalize the system to make whole the CRV market.”
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The post Aave Community Proposes Governance Changes Following Attempted Crypto Exploit appeared first on The Daily Hodl.


Community members of lending and borrowing platform Aave (AAVE) are submitting a governance proposal in the wake of an unsuccessful attempt to exploit the decentralized finance (DeFi) protocol. According to the AAVE community, a wallet with the address &#8220;0x57e04786e231af3343562c062e0d058f25d...

dailyhodl.com

Aave Community Proposes Governance Changes Following Attempted Crypto Exploit

The exploit failed due to a miscalculation of Aave's liquidity levels. 

Aave proposes governance changes after failed $60M short attack  

The Ethereum-based decentralized finance (DeFi) protocol Aave suffered an attack led by Avraham Eisenberg. The controversial individual was behind a sophisticated run against Mango Markets. The run has been called an attack by some and a clever strategy by others. 

Aave (AAVE) trades at $57 with a 7% and 36% loss in the last 24 hours and the previous week, respectively. Curve Finance’s native token CRV was also part of the attack. This token has seen significant selling pressure in the short term but has been trending to the upside over today’s trading session. 
AAVE’s price moving sideways after a downside trend on the daily chart. Source: AAVEUSDT Tradingview
Orchestrating An Attack On Aave, First Attempt?
Rudy Kadoch, founder of the portfolio management project Nested, summarized yesterday’s event and the “Bad Debt” attack on Aave. According to this report, Eisenberg borrowed $83 million of CRV and used $50 million of stablecoin USDC as collateral on the decentralized finance platform. 
Eisenberg published the thesis that supported this strategy in October 2022 via his Twitter account. It was public, and his objectives were perfectly outlined: to leverage his initial capital to influence the price of an illiquid token, such as CRV or Ravencoin (RVN), in hopes of creating “bad debt,” an excess liability assumed by the protocol. 

Check out recent activity in the @CurveFinance $CRV pools on @AaveAave V2!
Over the past couple of days, the $CRV pools on Aave have seen a significant increase in both borrow rate and volume, likely to go short on $CRV.  pic.twitter.com/Hx5Bt42Ks6
— Messari (@MessariCrypto) November 22, 2022 
To pay off this debt, Aave would trigger an auction mechanism that involves selling AAVE on the spot market. By taking a short position on this token, Eisenberg would benefit. 

I’ve been advised aave is perfectly safe so here’s the potential trading strategy. Not financial or legal advice, but if you do make 9 figures on this feel free to send a tip
Note that starting with more initial capital increases success odds and profit percentage pic.twitter.com/HKAF7Y5ogM
— Avraham Eisenberg (@avi_eisen) October 19, 2022 
By prompting the price of the underlying collateral, the Aave borrower can double or increase its price by five-fold “at least.” This attack was unsuccessful, as Kadoch noted, due to a lack of capital. The actor was trying to liquidate a CRV whale to create a bad debt. 
However, as the attack was being carried out, the team behind Curve Finance released the whitepaper for a stablecoin, crvUSD. This announcement supported the price of the token and shifted the trend. Kadoch noted: 
– $sdCRV, $cvxCRV, $yCRV depegged a lot with more than a 10% discount to get back $CRV.
– People are paying more than 200% to borrow $CRV.
– People telling Aave is not secure while the system was ready for such an event.
The Future Of Aave In Jeopardy?
On the other hand, the protocol operated as intended without centralized intervention. The team behind Aave claims that they will talk with the community and the DAO about the recent incident. 
In that sense, the protocol might introduce changes in the coming days to mitigate “long tail asset risk.” Many believe Eisenberg will resume its attack on the protocol once he can pool together more capital. 

You can call it attack on AAVE, but I actually think they made a mistake by not implementing a hard cap on how much CRV/other illiquid coins can you use as a collateral on AAVE. Otherwise you get a similar problem as with FTT.
— DeFiac (@TheDEFIac) November 23, 2022 
The “Bad Debt” attack on Aave was like the situation that led to the FTX’s collapse. The failed company issued held massive amounts of FTT, its native token. When the price of the asset crashed, Sam Bankman-Fried’s empire followed. 

Unlike FTX, as many users pointed out, everyone can access on-chain information about Eisenberg’s transactions, the state of the protocol’s finance, and the amount of bad debt it held on its balance sheet. This transparency is the critical difference between centralized ecosystems and decentralized protocols. The team behind Aave stated:
Most importantly, today’s events are in contrast to those we have seen with centralized entities in the space – the transactions were entirely traceable and auditable on-chain, providing transparency for users and the community.


The Ethereum-based decentralized finance (DeFi) protocol Aave suffered an attack led by Avraham Eisenberg. The controversial individual was behind a sophisticated run against Mango Markets. The run has been called an attack by some and a clever strategy by others.  Related Reading: Ethereum Class...

newsbtc.com

Aave Price Recovers Back To $57, But Threat Of New Attack Looms Over Protocol


The Aave (AAVE) price prediction is bullish due to a reclaim of a long-term horizontal support area and a short-term breakout. The Compound (COMP) price is trading inside a descending parallel channel and is approaching a crucial horizontal support area.



AAVE Price Prediction: Has Long-Term Correction Ended?



AAVE is one of the most well-known decentralized finance (DeFi) platforms. It allows users to lend and borrow. The AAVE price has decreased inside a long-term descending parallel channel since reaching an all-time high price of $527.80 in May 2021. The decrease led to a minimum price of $45.60 in June 2022. 



Initially, this decrease seemed to cause a breakdown below the $72 horizontal support area (red circle). The area had previously provided support since early 2021 (green icons). However, the AAVE price regained its footing shortly afterward and reclaimed the area. It validated it as support in Oct. 



Therefore, as long as the price is trading above this area, an eventual breakout seems to be the most likely scenario. A weekly close below it would invalidate the bullish hypothesis and suggest that new lows are expected. 



Technical analysis indicators are neutral. This is visible in the weekly RSI, which is increasing, but is still below 50.



AAVE/USDT Chart By TradingView


Short-term Catalyst for Upward Movement



The outlook from the daily time frame is mostly bullish. The AAVE price broke out from a descending resistance line on Oct. 16. It reached a high of $98.4 on Nov. 5. However, the $95 resistance area (red icon) has been rejected and has been decreasing since.



Currently, the price is trading between the 0.5-0.618 Fib retracement support levels at $77.80-$88.10 This is a likely area for a bottom. Furthermore, the daily RSI is still above 50. 



If the upward movement continues, the AAVE price could increase to $135.30, giving both part of the increase a 1:1 ratio.



A decrease below the wave B low of $64.7 (red line) would invalidate the bullish AAVE price prediction and indicate that a lower future price is expected.



AAVE/USDT Chart By TradingView


Compound Price Reaches Ideal Bounce Zone



The COMP price has decreased inside a descending parallel channel since Sept. 22. The downward movement has led to a low of $45.31 on Nov. 8. 



Despite the decrease, there are three reasons why a breakout is expected. 



Firstly, the price has bounced at the $45.50 horizontal support area. 



Secondly, the daily RSI has generated bullish divergence (green line).



Thirdly, the descending parallel channel is considered a bullish pattern.



If a breakout from the channel occurs, the closest resistance area would be at $59. On the other hand, a daily close below the $45.50 support area would invalidate the bullish forecast and lead to lower prices.



COMP/USDT Chart By TradingView


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Disclaimer: BeInCrypto strives to provide accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. You comply and understand that you should use any of this information at your own risk. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.
The post COMP and AAVE Price Prediction: DeFi Tokens Stand Their Ground Despite Market Correction appeared first on BeInCrypto.


The Aave (AAVE) price prediction is bullish due to a reclaim of a long-term horizontal support area and a short-term breakout. The Compound (COMP) price is trading inside a descending parallel channel and is approaching a crucial horizontal support area.
The post COMP and AAVE Price Prediction: D...

Aave price	$63.97
Low - High 24H	$63.55 - $67.14
Market cap	$908.33M
Volume 24H	$60.50M
All time high	$661.69 -90.32% May 18th 2021
All time low	$26.02 146.03% November 5th 2020
Genesis date	N/A

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