Andre Cronje: About $200M in rsETH taken in L0/rsETH incident after key leak or misconfiguration

April 19 — Andre Cronje, co-founder of Sonic Labs and founder of Flying Tulip, said his team is continuing to investigate the L0/rsETH incident. Early findings indicate a compromised private key or a configuration mistake may have enabled the theft of roughly $200 million worth of rsETH. Cronje said the rsETH was then deposited into Aave to borrow ETH, citing limited rsETH liquidity. He noted the position remains collateralized from a technical standpoint, and added that even in an under-collateralized scenario, Aave's token and security module are designed to serve as a first line of defense against bad debt. He also stressed that Aave has no mechanism to reimburse user losses, meaning that in an extreme scenario the situation could trigger a "bank run." Still, he said the potential fallout appears contained given Aave's roughly $7 billion in ETH versus about $100 million in withdrawals and PUT's $17 million exposure. Cronje said the priority remains protecting users' PUT liquidity. As Aave's available liquidity dropped below the team's minimum threshold, they withdrew all ETH from Aave and moved it into their own wrapped contract.