[ad_1]
Major decentralized lending protocol Aave has “temporarily” frozen its lending services across 17 markets citing excess volatility that could pave the way for market manipulation attempts.
The DeFi protocol passed a governance vote on the matter yesterday, with almost all members casting their votes in support of the proposal. More specifically, less than 0.01% of AAVE holders voted against the proposal while almost 100% supported it.
“A proposal to make parameter changes on Aave V2 ETH. Given that the market situation of these assets is currently volatile, out of an abundance of caution, we recommend temporarily freezing the following markets,” the proposal reads.
The protocol froze lending on 17 cryptocurrencies, including five stablecoins. The suspended stablecoins include sUSD, USDP, LUSD, GUSD and RAI.
The other assets affected are Yearn Finance (YFI), Decentraland, 1inch (1INCH), Curve Finance (CRV), 0x (ZRX), Basic Attention Token (BAT), Enjin (ENJ), RENFIL, MakerDAO (MKR), xSUSHI, Ampleforth (AMPL), and DeFi Pulse Index (DPI).
The freeze means that users cannot take loans on the assets or deposit them on the protocol. According to the proposal, Aave’s decision to freeze the assets comes as the DeFi project aims to reduce the risk to Aave version 2 and to promote the eventual migration to version 3 of the protocol.
Failed $60-Million Attack on Aave
The recent governance proposal comes as Aave faced a $60 million short attack on its CRV pool using USDC as collateral earlier this month. The attack was unable to go through because of a wrong calculation of the decentralized protocol’s liquidity levels.
“The Aave ecosystem was built with a number of mechanisms that the Aave community can deploy to cover events like this, including the Safety Module, the Ecosystem Reserve & the DAO Treasury,” the protocol said in a tweet addressing the issue.
The attacker happened to be Avraham Eisenberg, the same person who exploited Solana-based DeFi lending platform Mango Markets, referring to his actions as “a highly profitable trading strategy.” Notably, he was previously accused of stealing treasury funds from Fortress DAO, a fork of Olympus DAO running on the Avalanche blockchain, where he was a lead developer.
Nevertheless, the recent news has caused CRV to register some gains. The token is currently trading at $0.671433, up by 4.4% over the past day. Furthermore, the coin is up by more than 33% over the past month.
[ad_2]
cryptonews.com
