How KelpDAO's Exploit Left Aave With $200M Bad Debt - Bits + Bips
24 Apr 2026 · 48:30
On Bits + Bips, host Steve Ehrlich, head of research at SharpLink, talks with Blockworks researchers Luke Leasure, Shaunda Devens, and Carlos Gonzalez Campo about the LayerZero DVN exploit that let an attacker mint unbacked rsETH and originate a $193 million loan against fraudulent collateral inside Aave's unified lending pool. They walk through how the exploit spread through leveraged looping positions, why Aave's umbrella insurance module looks undercapitalized for the resulting bad debt, and whether DeFi risk management is quietly centralizing in response.