Andre Cronje: Aave Lacks a User Loss Backstop; ETH Pulled Into a Wrapper Contract

Odaily Planet Daily reports that Andre Cronje, co-founder of Sonic Labs and founder of Flying Tulip, said in a post on X that his team is still investigating the L0/rsETH incident. Early findings indicate roughly $200 million in rsETH was stolen, potentially due to a private key compromise or a configuration error. The attacker then deposited the assets into Aave to borrow ETH, citing limited rsETH liquidity. Cronje said the impacted positions remain technically collateralized. If any position were to default, Aave's tokenomics and Safety Module would be the first line of defense to absorb losses. He added that Aave has no mechanism to subsidize user losses, warning that such a move could trigger a bank run. Aave currently holds about $7 billion in ETH and has around $100 million in withdrawal requests, suggesting the incident's overall impact is limited. Separately, to prioritize user liquidity, Flying Tulip has withdrawn all ETH from Aave into its fund management wrapper contract after Aave's available liquidity fell below an internal minimum threshold.