Aave

Blast

2024

Giant

<p class="is-style-lead">An Aave fork on Blast network liquidated user positions worth over $26 million due to an erroneous threshold change.</p> 
<p>Pac Finance, an iteration of decentralized finance (defi) lender Aave on Coinbase’s layer-2 chain Blast, attempted to adjust its loan-to-value (LTV) parameters on April 11. Instead, the Aave fork unknowingly reduced its liquidation threshold.</p> 
<p>The result was a sweeping wipeout of Ether-collateralized (<a href="https://crypto.news/price/ethereum/" target="_blank" rel="">ETH</a>) positions on the platform. According to&nbsp;<a href="https://x.com/wilburforce_/status/1778426380608307538" target="_blank" rel="">Will Sheehan,</a>&nbsp;Founder of block explorer Parsec, one user lost up to $24 million due to the Aave fork incident on Blast. On-chain analytics also showed participants thousands of dollars in losses denominated in ezETH.</p> 
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter">
 <div class="wp-block-embed__wrapper"> 
  <blockquote class="twitter-tweet" data-width="550" data-dnt="true">
   <p lang="en" dir="ltr">Giant swath of ezETH Liquidations on pac finance last night on blast, someone got tagged for $24m <a href="https://t.co/uzqRX0UAUD" target="_blank" rel="">pic.twitter.com/uzqRX0UAUD</a></p>— Will Sheehan (@wilburforce_) <a href="https://twitter.com/wilburforce_/status/1778426380608307538?ref_src=twsrc%5Etfw" target="_blank" rel="">April 11, 2024</a>
  </blockquote>
  <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> 
 </div>
</figure> 
<h2 class="wp-block-heading" id="aave-fork-pac-finance-admits-error">Aave fork Pac Finance admits error</h2> 
<p>Hours after the issue was highlighted, Pac Finance <a href="https://twitter.com/pac_finance/status/1778529972447252497" target="_blank" rel="">acknowledged</a> the mistake and disclosed that affected users were contacted. The team also said a plan to mitigate the error was in the works.</p> 
<blockquote class="wp-block-quote"> 
 <p>“In our effort to adjust the LTV, we tasked a smart contract engineer to make the necessary changes. However, it was discovered that the liquidation threshold was altered unexpectedly without prior notification to our team, leading to the current issue.”</p> <cite>Pac Finance team</cite>
</blockquote> 
<p>To avoid further mishaps, Aave promised to set up a community forum to discuss future upgrades and changes to its defi lending protocol. Pac Finance added that it intends to deploy a governance contract to reaffirm transparency and repair user trust.</p> 
<p> You might also like: <a href="https://crypto.news/aave-parent-company-rebrands-to-avara-adds-crypto-wallet-family-to-offerings/" rel=""> Aave parent company rebrands to Avara, adds crypto Family Wallet to offerings </a> </p> 
<p>Stani Kulechov, Founder of blockchain developer Avara and the parent company behind Aave’s project, <a href="https://twitter.com/StaniKulechov/status/1778693911763955870" target="_blank" rel="">tweeted</a> that the matter highlighted a root issue with protocol spin-offs.</p> 
<blockquote class="wp-block-quote"> 
 <p>A fundamental problem with forking code is the lack of in-depth knowledge of the software and the parameters.</p> <cite>Stani Kulechov, Avara Founder</cite>
</blockquote> 
<p>The lending market is one of defi’s largest sectors, allowing users to borrow and provide liquidity to crypto’s burgeoning ecosystem. According to DefiLlama, lending protocols hold nearly $35 billion in total value locked (TVL).</p> 
<p><a href="https://crypto.news/price/aave/" target="_blank" rel="">Aave</a>&nbsp;is the most significant player in the market with $11.5 billion in TVL and availability across 12 chains, including Ethereum, Arbitrum, Polygon, Optimism, Avalanche, Gnosis, Base, Metis, Binance Smart Chain, Scroll, Fantom, and Harmony. It has also deployed its&nbsp;<a href="https://crypto.news/aaves-stablecoin-gho-hits-minting-limit/" target="_blank" rel="">stablecoin GHO</a>&nbsp;to compete with Maker’s DAI token on Ethereum’s blockchain.</p> 
<figure class="wp-block-image size-large">
 <picture loading="lazy" decoding="async" class="wp-image-14265202"> 
  <source type="image/webp" srcset="https://crypto.news/app/uploads/2024/04/Screenshot-379-1024x651.png.webp"> 
  <img loading="lazy" decoding="async" width="1024" height="651" src="https://crypto.news/app/uploads/2024/04/Screenshot-379-1024x651.png" alt="Aave fork"> 
 </picture> 
 <figcaption class="wp-element-caption">
  Top five defi lender | Source: DefiLlama
 </figcaption>
</figure> 
<p> Read more: <a href="https://crypto.news/aave-deploys-dai-stablecoin-competitor-on-ethereum/" rel=""> Aave deploys DAI stablecoin competitor on Ethereum </a> </p>

Aave fork on Blast mistakenly liquidated $26m

Table of Contents

crypto.news

Άλλα άρθρα που δημοσιεύτηκαν στις 12 Απρ 2024

AI Deepfakes in Crypto are Getting Out of Control

Peter Schiff Takes Jab at Bitcoin's Lack of Utility

MarginFI’s TVL Drop by Over 50% Following CEO’s Sudden Exit

US gov’t among states with largest Bitcoin holdings — Arkham

Hong Kong Poised to Greenlight Bitcoin and Ethereum Based ETFs

Binance Coin Price Prediction: Could the value of Binance Coin surge beyond $1679 by 2029

Join our free newsletter for daily crypto updates!