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ID:

aave-1318

Date:

Status:

Incident Count:

November 23, 2022

Verified

1

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REKT

Contributor:

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web3rekt.com

KYC By:

KYC:

None

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Audit By:

Audits:

None

Loss Amount:

1,600,000

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Recovered:

-

Rewards:

Ticker:

USD

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Avraham Eisenberg, the trader behind October’s Mango Market hack, recently borrowed 40 million curve (CRV) tokens from decentralized lending platform Aave. The drastic move is part of an apparent scheme to sell off the tokens, plummet CRV’s value as a result, and make away with millions in short positions on the token—leaving Aave saddled with a massive quantity of bad debt. The trader himself ended with lost ~$6M (e.g., he lost $63M in USDC and gain $57M in CRV) - https://twitter.com/TradingProtocol/status/1595367591555407872.

However, Aave was successfully cleared the liquidation of CRV pool on AAVE protocol. However, due to the size of the pool, some bad debt were left in the protocol resulting in uncovered position of 2.64M CRV token or ~$1.6M to be absorbed by the protocol.

Gauntlet, Aave's financial modeling platform, recommends to freeze a number of tail assets on v2 to mitigate the risks of similar, likely unprofitable, squeezes.

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