Aave TVL Stays Down 43% Months After KelpDAO Hack

Aave is still feeling the pain from the April hack of KelpDAO, with total value locked sitting 43% lower than it was right before the attack. Back in April, North Korean hackers targeted KelpDAO and used stolen receipt tokens as collateral to borrow real assets on Aave. That left Aave and other protocols with hundreds of millions in bad debt.

Even though Aave's core contracts worked as intended and allies eventually helped rebuild the missing collateral, depositors remain nervous. Aave held $26.4 billion in deposits just before the hack, but that number sits at $14.9 billion today. The protocol has also lost its long held title as the biggest platform in decentralized finance.

This drop matters because a smaller pool means less liquidity for borrowers and higher market volatility. Traders should watch to see if user confidence returns or if depositors continue looking elsewhere for lending and borrowing.