Aave is coordinating one of the largest emergency support efforts seen in DeFi after the Kelp DAO attack left a major rsETH bad debt problem on the lending protocol. According to the DeFi United website, pledged support had exceeded $303 million as of April 27, following the incident on April 18.
The attack unfolded at 1:35 a.m. Taiwan time on April 19, when the attacker targeted Kelp DAO’s LayerZero bridge and pulled 116,500 rsETH from an Ethereum mainnet escrow contract, worth about $292 million at the time. The attacker then minted rsETH with no backing and used those tokens on Aave to borrow real ETH, leaving the protocol with a large hole in its books.
Consensys, Lido, Mantle and others join the effort
Aave founder Stani Kulechov contacted Consensys and other ecosystem participants shortly after the exploit, seeking rescue commitments before governance proposals could move through the usual process. Consensys and its founder Joseph Lubin agreed to provide financial support of up to 30,000 ETH. Sharplink served as a strategic adviser during the coordination process.
Publicly disclosed commitments include up to 30,000 ETH from Consensys and Joseph Lubin, a 30,000 ETH credit line from Mantle, support under discussion from EtherFi of up to 5,000 ETH, a governance proposal from Lido for 2,500 stETH, and a 3,000 ETH funding proposal from Compound. Renzo committed more than $10 million from its treasury, while Babylon Foundation offered a 3 million USDT deposit. Circle Ventures bought AAVE tokens, though it did not disclose the amount. Avalanche Foundation, Solana Foundation, and Justin Sun were also listed as participants without public figures.
Pledges are large, but available capital is smaller
The rescue package is split across donations, deposits, and credit facilities. That matters. A donation sends funds outright, deposits can in theory be withdrawn later, and a credit line may only be tapped if needed. The structure widened participation, but it also means the headline total does not equal cash already in hand.
As of April 26, Aave had actually raised about $160 million, with a goal of covering $200 million in bad debt. That leaves roughly $40 million still missing. At the same time, Aave has been trying to unlock ETH currently frozen on Arbitrum for compensation to affected rsETH holders, a path that also depends on governance approval.
Governance approval still stands in the way
Several of the commitments still require formal approval from the relevant protocol communities before funds can be deployed. Lido’s 2,500 stETH proposal and Compound’s 3,000 ETH proposal were still under discussion in the source material. An Aave Labs spokesperson said many participants have a direct interest in keeping the market functioning because of their ties to infrastructure, capital, and user access across DeFi.
The DeFi United plan has already become a rare case of competitors coordinating around a shared risk event. Whether those commitments turn into deployable capital, and whether affected users are made whole, remains tied to the outcome of those governance processes.