You are the one doing the spamming. You earn the yield, you take the risk that pays that yield. End of story.
āYou earn the yield, you take the risk that pays that yield. End of story.ā
No, f* clown, you and gambling addicts like you are the ones whoāll suffer possible losses. Donāt get it twisted, and donāt try to blame your mistakes on me.
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That incident involved bridged assets that became unbacked after a bridge hack, not pure ETH suppliers with no borrow, no leverage, and no exposure to the compromised asset. Even in Harmony, the issue was a long and messy recovery, not a justification that innocent lenders should absorb losses. In this case, Aave itself states the exploit happened outside the protocol, and the question is how losses are allocated - not whether unrelated ETH suppliers should pay for them. So it does NOT justify haircutting users who never took the risk in the first place.
You loaned your money to people who put up rsETH as collateral, including the thievesā¦as did we all. What you think should be moral and just is irrelevant. That the exploit happened outside of AAVE is also irrelevant hereā¦and will only be relevant if LayerZero or KelpDao decide to take 100% accountability for making everybody square. You keep insisting that AAVE make some choice that isnāt theirs to make. The socializing to loss (or not) happens at Kelp. Go yell at Kelp.
My ETH is still frozen in the AAVE Arbitrum pool. Since Arbitrum already got the ETH back, AAVE should unfreeze the Arbitrum ETH pool ASAP! But we didnāt see any explanation or plan about the next step and timeframe. The is no post after Arbitrum transferred the stolen ETH.
Please! At least update the latest progress everyday. Otherwise, the reputation and trust of AAVE gone with TVL every minute!
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Check my last comment in the other topic. This one: rsETH incident ā 2026-04-18
That argument collapses two different layers: the exploit layer and the governance layer. Kelp may control rsETH recovery, but Aave controls what happens inside Aave markets. Aaveās own incident report says no official Kelp loss-allocation decision had been publicly confirmed, that the socialization boundary is still an open variable, and that loss allocation remains subject to decisions external to Aave while Aave models the outcomes for its own markets. At the same time, Aave froze WETH on Linea. So no, this is not something that āonly happens at Kelpā - Aave is already making the market-level decisions that affect depositors.
The āwe all loaned to rsETH usersā line is also wrong as applied to pure Linea suppliers. The governance request explicitly separates āpure ETH suppliers on Lineaā from users who used borrowing, looping, restaking, or rsETH, and asks to exclude that group from haircut or socialized losses. That distinction exists because a pure supplier is not the same risk class as someone who chose rsETH or leveraged exposure.
So the real issue is simple: Kelp may owe recovery, but Aave decides whether unrelated Linea lenders stay frozen, get socialized losses, or get excluded. Saying āgo yell at Kelpā is not a defense; it is an attempt to dodge the governance decisions that actually determine what happens to innocent suppliers.
btw, how much longer are you going to keep tagging me in an attempt to cover up your gambling addiction, you f* clown?
It was a similar incident: innocent users like me simply made the mistake to lend ONE tokens on harmony by AAVE. Exact same issue for ETH here. Say it the way you prefer but whatās happening is very similar.
While kelp and lz argue over who is to blame, Aave is losing its reputation. Arbitrum has already made its contribution, with a tough decision. If Aave has the ability to redeem itself (rsETH ā wETH) now is the time to start.
Fluid made a way out. Check on X. I did exit. Roughly 2% loss of eth, but I donāt care about that. Maybe if they unfreeze funds I couldāve got 100% of the collateral, but I am not going to risk that. Go ahead guys, way out is there.
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I agree. To be penalized for another network completely irrelevant to Base is asinine.
Not only did NK not interact with Base, no issues occurred involving Base and yet Base network users are somehow penalized simply because theyāre an L2??
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@LlamaRisk and others
While the rsETH freeze and bad debt handling are the immediate focus, the secondary liquidity crunch in stablecoin pools (especially USDC on Ethereum Core) continues to trap billions in user funds.
Stablecoin utilization has remained pinned near 100% for days, with available liquidity near zero and withdrawals severely restricted for many LPs ā even as borrow rates sit around 14%.
Iāve posted a detailed discussion note with concrete parameter options to fix this:
[ARFC] Improve Liquidity Buffer for USDC on Ethereum Core ā Raise Slope 2, lower optimal utilization ā [Link]
It proposes:
- Lowering optimal utilization from 92% ā 87% (interim) / 85% (target) for a larger liquidity buffer
- Raising base Slope 2 from 10% ā 40% (interim) / 50% (target) to make the curve more effective at attracting new supply under stress
The goal is simple: let the interest rate model do what it was designed for ā clear the market quickly by drawing in fresh capital when utilization spikes, instead of leaving LPs stuck.
Happy to iterate on the numbers. Would welcome LlamaRiskās view on whether a Risk Steward action could help resolve this faster while the broader incident is managed.
Thanks for the ongoing work during a tough period.
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Is Circle part of the deal here?
looping happened mostly on mainnet
this is a personal post
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Interesting, then why the proposal is limited to USDC only?
If this platform is experiencing a deficit, itās in the reading comprehension skills of some of the depositors.
I know you meant your reply to be inflammatory, but I think youāre misunderstanding some key things, and those misunderstandings are probably what is fueling your anger.
- When you deposit money in Aave and earn lending interest, you are agreeing to let people borrow your asset in exchange for their deposits of other assets (meaning, all of the other assets Aave accepts, rsETH included). That means your deposit always experiences counterparty risk related to changes in the underlying value of those other assets. You agreed that you understood this when you checked a box to deposit on the platform.
- The value of that deposited rsETH is currently in question while we await to see how KelpDAO is going to handle the problem. We might find that the exchange rate of rsETH retains full value on some chains and not others. We might find it loses value on all chains. Until then, Aaveās governance has chosen to freeze some assets while it discovers how things are going to be handled.
When the platform accepted rsETH and lent out ETH in exchange, you could compare it to a bank giving a reverse mortgage for a bridge, when it turns out the depositor did not actually own that proverbial bridge. You are part of that loan when you deposit on the platform. The freezing that has occurred is part of that risk mitigation process and youāre watching, in live action, what handling risk looks like.
In the traditional finance world, the bank that wrote that mortgage would write off the loss and then seek financial restitution from the person that printed the fake deed. The person that printed the deed, in turn, would be suing the company they relied on for checking credentials for their partial negligence. What we have in DeFi is a lot less organized and formal, so itās a lot like kids arguing at a playground about what the rules ought to be. There are even more children arguing on the sidelines, in this thread. Itās going to get sorted out eventually, but nothing said in here is going to have an impact on that.
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I know you meant your reply to be inflammatory, but I think youāre misunderstanding some key things, and those misunderstandings are probably what is fueling your anger.
Stop flattening everyone into one fake risk bucket. I did not borrow, loop, restake, or touch rsETH. Aaveās own forum request explicitly separates pure ETH suppliers on Linea from users who used borrowing, looping, restaking, or rsETH, and asks to exclude that clean supplier class from haircut or socialized losses. That distinction exists for a reason: those are not the same risk class. Aaveās incident report also shows that WETH on Linea remains frozen while other markets were unfrozen, which means this is a governance outcome inside Aave, not some moral debt I āagreedā to inherit by supplying ETH.
So the line āyou loaned your money to people who put up rsETH as collateralā is exactly the bait-and-switch. It tries to smear the cost of leveraged rsETH/bridge risk across innocent suppliers who were only there for basic lending and a tiny yield. If the protocol wants to socialize losses from gamblers and bridge-risk takers onto clean lenders, say that plainly. Do not pretend that a pure ETH supplier who never touched rsETH signed up to underwrite someone elseās bad collateral decision.
Donāt dump losses from leveraged bridge risk onto users who never took it. Am I making myself clear, you damn clown?
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Thereās a coordinated pattern in this thread: accounts amplifying each other to blur personal responsibility and reframe individual risk-taking as āeveryoneās problemā
That narrative does not work
I did not borrow, loop, or touch rsETH. I supplied ETH for a nominal yield. That is not consent to absorb losses from other peopleās leveraged or bridge-exposed strategies. If the protocol tries to socialize those losses onto clean suppliers, it will destroy trust immediately - and it will not end there. Attempts to take from users who did not take the risk will be challenged everywhere that matters.
RISK BELONGS WHERE IT WAS TAKEN. NOT TO INNOCENT LENDERS.
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Stop flattening everyone into one fake risk bucket.
You realize thereās a huge difference in the scale of losses, right? Those with looped/leveraged rsETH positions will lose 100% of their initial deposit once their liquidation happens, regardless of how the losses are allocated. Thatās what happens when you take on 10x leverage and there is at least an 11% relative loss of value of the deposited coin.
In comparison, if the numbers here rsETH Incident Report (April 20, 2026) - #65 by LlamaRisk are correct, the worst case loss for simple, unleveraged WETH depositors on Linea is 1.89% of their weth deposit. That sucks. It is about the equivilant of losing ~10 months of yield. But it isnāt anywhere near the end of the world. And frankly, it isnāt the result of any socialization. It is simply the math of what the shortfall is relative to the total weth deposits. And it is a lot better then what the weth depositors on other L2ās are facing. If Kelp socializes the loss accross all rsETH holders instead of just the L2 users, then those numbers imply a 0.08% loss to weth depositors on Linea. Ie, about 2 weeks worth of yield. Again, it sucks, but it is practically nothing.