Aave is handing out the throne of Defi for his stupidity

Original Odaily Daily@OdailyChinaI'm not sure

By Azuma@azuma ethI'm not sure

$292 million, the total amount of rsETH stolen from Kelp DAO, and $17.2 billion, the scale of funds flowing from Aave since the beginning of the events。

Aave is fermenting for days in the midst of his very stupid crisis PR strategy, and then loses his once greatest advantage in the lending track -- the tens of billions of dollars-grade sedimentary scale and the "safest DeFi" user intellectual label。

• Odaily note: Previously on Love:DeFi stole $292 million again, and it's not even safe for Aave)Who's going to pay for thisI don't know。

Aave, what's wrong

The details of Kelp DAO hacking are no longer much to say, and it makes no sense to accuse Aave of giving rsETH such a high LTV, which is basically to talk about Aave's coping strategy after a long-term AAVE user。

First of all, there's the problem of the scale of bad debts, and Aave's done it himself. Based on the different dispositions of rsETH, there may be two possible bad debts - & nbsp;Deduction of stolen losses from all rsETH flows is expected to result in bad debts of $123.7 million; if the value of the main network rsETH is guaranteed, the loss is fully accounted for in the map version rsETH of Layer2, which is expected to result in bad debts of $230.0 million。

In either case, with Umbrella, DAO treasury, team reserves, Aave has the power to cover. I understand that Aave would not be willing to pay for it himself, that he wanted Kelp DAO, the main party responsible for the accident, and LayerZero, to blow up as much gold as possible, but the problem is that the other side would also think that -- "You, Aave, are so rich, so embarrassed, so much more responsible." So, in the short term, it is difficult to reach a consensus on this triad, which means that there can be no happy solution for the time being。

But it's not possible for the user to wait so long -- Aave's yield level has never been competitive in the industry, and the users who choose to deposit with Aave are motivated by credibility, security, mobilityBut what happened now is that Aave, the most tense days after the incident, never gave the user some kind of bottom-up commitment, but rather focused on "your own code is fine" and "rseth how to account for Aave cannot control" to dump the pot。

This is why panic has been fermenting in the community, and users will try to escape risk, take it directly if they can, and borrow it from other pools if they can't, leading to a widening impact。So now Aave is faced with an ongoing outflow of funds while multiple pools run out of liquidity due to their full utilization。

This awkward situation could have been avoided...If Aave can afford to pay, why don't you start by injecting the community with an aphrodisiac to prevent run-off? Up to $230 million (perhaps less) of bad debt, which could not be paid for by the Aave family alone, followed by layer Zero, Kelp DAO。

Now it's okayIn order to save up to $230 million of promised relief, Aave watched the $17.2 billion loss of sedentary funds (the number may continue to grow), which has not been factored into the fall in AAVE currency prices these days...How can it be a loss。

What makes Aave even more difficult is that the worse it is, the more comfortable it will be for the rivals like LayerZero and Kelp DAO, because they will judge that Aave will be more motivated to solve the problem as soon as possible, which will only put Aave at a disadvantage in the game。

This is where Aave got to。

Behind aave, Spark, looking right at him

While Aave's headaches are on the rise, the current situation of the competition, Spark, is so much better. And what's even more remarkable is that Spark is the competition that Aave has hatched。

Spark was a loan agreement for Sky (formerly MakerDAO) based on the open-source fork development of Aave V3, which applied the same bottom code logic. In return, there was a profit-sharing agreement between Spark and Aave, but later, Aave accused Spark of being involved in a breach of the contract, along with differences of routeThe two sides are now in a purely competitive relationship。

Spark has just removed support for rsETH three months before Kelp DAO was stolen (for more details, see:Life on the same day: Aave hugged rsETH at nearly 200 million, and Spark withdrew. No damage)You can say that it's strategic and conservative, and it's even entirely attributable to luck, but the result is that Spark was affected by anything in this case -- and that's the point where Spark was able to unbridledly attack Aave's once-safest DeFi label。

So Spark became one of Aave's safe havens。Spark TVL has grown by nearly $2 billion since the beginning of the events, Sun has proposed 53665 ETH (value $124 million) from Aave on the day of the events, and has deposited into Spak, and has continued to accumulate a total of $1.3 billion in recent days — and in DeFi’s world, Sun’s operations are really learning。

On April 23, Upbit officially announced that he was on line with the Spak (SPK) Korean dollar trading market, and that SPK had been encouraged to increase by more than 80 per cent a day, significantly reducing the market value gap between itself and AAVE。

Even the founder of the fish pool, Wang Pure, was impressed by X: “In the past year, I received 83.7 million SPK awards from Spark and sold them on COWSwap in exchange for 663 ETH and $1.4 million。A little regret now。It's not the same

Spark clearly realizes that this is an excellent opportunity to take market shares from Aave。Since the incident, the Spark strategist, NetSupply, has almost become the most high-frequency KOL voice on the matter, with dozens of posts a day. While it was true that his statement helped the public to understand what was happening, it also contributed objectively to the fear surrounding Aave。

But that's the purest business competition, MonetSupply just made the right choice。

Aave is losing DeFi's borrowing throne

On April 24th, in the early hours of the morning, or aware of the current critical situationThe founder of Aave Stani announced in X that he would launch a relief scheme called DeFi United, with LayerZero, Ethena, other.fi, Ink Foundation, Golem Foundation, Trinidad and others, and Stani individuals would also donate 5000 ETH to solve the current problem。

However, funds have been lost and user trust has been severely compromised. It's very late, and it's very difficult for Aave to restore the money and the trust of the users in a short time。

DeFi's lending track has long been in a pattern of "a super strong" and Aave has always had a seemingly strong lead。But now, Aave gave up the throne. Behind him, the challengers came, and in addition to Spark, which is gaining momentum, Morpho, Jupiter Lend, among others, wanted to eat from Aave。

Last year, Stani purchased a five-storey house in London for about $30 million, one of the most expensive deals in the United Kingdom's depressed luxury housing market over the past year. I don't know if there's anything like "venom milk," but there's Su Zhu and others, like the big guys who are high-profile consumers in their circles, they're always gonna hit some shit。

I can't guess what Stani's thinking in his five-storey mansion today。