Aave rsETH Event Update: Core V3 WETH Unfrozen, Five Major Markets Reserves Still Frozen

Aave announced on April 21 on the X platform that the WETH reserves in the Ethereum Core V3 market have been unfrozen, and users can supply WETH back to Ethereum Core V3; the WETH loan-to-value ratio (LTV) remains at 0. WETH reserves on Ethereum Prime, Arbitrum, Base, Mantle, and Linea remain frozen.

Aave April 21 freeze-and-unfreeze status

According to an X-platform announcement published by Aave on April 21, 2026, rsETH remains frozen on Aave V3 and V4. The current status of the WETH reserves is as follows:

Unfrozen: WETH reserves in the Ethereum Core V3 market (WETH LTV still 0)

Still frozen: WETH reserves on Ethereum Prime, Arbitrum, Base, Mantle, and Linea

April 19 KelpDAO rsETH attack: Event timeline

According to public reports, on April 19, 2026, Kelp DAO’s rsETH cross-chain adapter was attacked. By exploiting a bridging vulnerability, the attacker abnormally minted 116,500 rsETH (valued at about 293.7 million USD, roughly 18% of the token’s total circulating supply), and deposited it into the Aave V3 and V4 markets in less than 90 minutes, causing what is reportedly the largest indirect loss in Aave’s history, about 200 million USD. The Aave team subsequently froze the ability to borrow and supply rsETH on the Ethereum mainnet, as well as on layer-2 networks such as Arbitrum and Optimism, and urgently set the rsETH LTV to 0.

Market impact: TVL and token price data

According to DefiLlama data, Aave TVL fell from 26.3 billion USD to 18.0 billion USD over the two days from April 19 to April 20, evaporating 8.3 billion USD in two days, a drop of more than 31%. According to Lookonchain monitoring, Abraxas Capital withdrew 392 million USD, MEXC withdrew 431 million USD, and the whale 0x7CD0 withdrew 405.7 million USD. According to Bitget market data, the AAVE token price fell from about 114 USD before the attack to about 93 USD on April 20; the USDT borrowing APY briefly rose to 14.99%, while the deposit APY reached 13.39%.

Statements from various parties

In an April 20 community AMA, Aave founder Stani said that Aave’s core contracts had not been breached; this incident is “upstream contamination” rather than a protocol vulnerability. He said that the protocol’s treasury reserves and monthly average revenue of about 12 million USD are sufficient to cover the losses, and that in the short term it will not activate the security module slash or token issuance.

In an X-platform analysis, DefiLlama founder 0xngmi said that if KelpDAO handles the loss through socialized loss sharing, Aave will incur bad debt of about 216 million USD; Umbrella’s security module can cover 55 million USD, the treasury will also cover an additional 85 million USD, but there will still be a remaining gap of 76 million USD; if KelpDAO sacrifices L2 users, Aave’s bad debt size rises to about 341 million USD.

On the X platform, Curve founder Michael Egorov said that this incident is the risk brought by a “non-isolated lending model,” and pointed out that Aave v4’s centralized, hub-and-spoke model “might be a step toward semi-isolation and a safer direction.”

FAQ

Aave April 21 update: Which WETH markets have been unfrozen, and which remain frozen?

According to an X-platform announcement on April 21, 2026, from Aave, the WETH reserves in the Ethereum Core V3 market have been unfrozen (WETH LTV still 0); the WETH reserves on Ethereum Prime, Arbitrum, Base, Mantle, and Linea remain frozen.

How much impact did this KelpDAO rsETH attack have on Aave TVL?

According to DefiLlama data, Aave TVL fell from 26.3 billion USD to 18.0 billion USD over two days from April 19 to April 20, evaporating 8.3 billion USD, a drop of more than 31%; public reports show that Aave’s indirect loss is about 200 million USD.

What position did Aave founder Stani take regarding the loss response?

According to Stani’s statement in an April 20 community AMA, Aave’s core contracts were not breached, and this incident is “upstream contamination.” He said that the protocol’s treasury reserves and monthly average revenue of about 12 million USD are sufficient to cover the losses, and that in the short term it will not activate the security module slash or token issuance.