Aave survives $8.45 billion withdrawal crisis, but DeFi hidden risks come under scrutiny again

Odaily Planet Daily News: DeFi lending protocol Aave successfully maintained operations after experiencing approximately $8.45 billion in fund withdrawals. However, the incident has simultaneously triggered renewed market discussion regarding its risk structure and the fragility of the DeFi system.

The stress event originated from a vulnerability attack on the KelpDAO rsETH cross-chain bridge in April 2026, resulting in the theft of approximately $292 million in assets. This sparked market concerns over the security of rsETH as collateral. As this asset was widely used as collateral on Aave, panic quickly spread, leading to a concentrated withdrawal of funds by users.

During the capital outflow process, liquidity in some lending markets was rapidly depleted, with utilization rates approaching 100% at one point. Aave managed the situation by adjusting risk parameters and activating emergency mechanisms, although localized withdrawal restrictions still occurred.

Despite this, Aave's core smart contracts were not compromised. Protocol founder Stani Kulechov stated that the event validated the system's stability and resilience under extreme stress.

However, analysts pointed out that the incident exposed structural risks within DeFi: the high degree of asset coupling across protocols, reliance on external bridged assets as collateral, and the potential for liquidity to dry up quickly under extreme conditions.

Industry observers believe that while DeFi's "composability" enhances efficiency, it also accelerates risk transmission, potentially causing a single asset event to trigger systemic cascading effects. Although Aave successfully passed this stress test, the outcome does not equate to the elimination of risk.

Overall, the event is viewed as a real-world extreme stress test for the DeFi lending system: the system can function, but its stability remains highly dependent on the quality of external assets and the market liquidity environment. (Cointelegraph)