Post #11958

🚨 BREAKING: Aave hit 100% utilization - $5B stuck across core markets Roughly $5B in USDT and USDC is stuck on Aave - users can't withdraw after whales pulled billions post-rsETH exploit, leaving late depositors trapped while exit liquidity vanished in hours. Main Points: • rsETH exploit left Aave with ~$200M in bad debt • Whales (Justin Sun, MEXC, others) instantly drained liquidity across ETH, USDT, USDC markets • All core markets hit 100% utilization - withdrawals frozen • At full utilization, the protocol can't process liquidations if prices move • Bots now front-run any liquidity that briefly opens up • Contagion spreading - protocols relying on Aave for yield are stuck too The deeper problem: rsETH was onboarded as collateral at hundreds of millions in size, which is what allowed the hacker to walk away with $200M+ in ETH against fake collateral. Yield in DeFi no longer compensates only for smart contract risk - it now prices in liquidity lock risk, governance risk, and how fast large players can drain a market Top 7 Ecosystem:Alpha| X | Aggregator