Major decentralized lending protocol Aave has “temporarily” suspended lending services in 17 markets, citing excessive volatility that could pave the way for attempts to manipulate the market.
Yesterday Duffy Protocol approved the referee’s vote on the matter, with nearly all members voting in favor of the motion. Notably, less than 0.01% of AAVE holders opposed the proposal, while nearly 100% supported it.
The protocol stopped lending of 17 cryptocurrencies, including five stablecoins. Banned stablecoins include SSD, USDP, LUSD, GUSD, and RAI.
Other affected assets are Yearn Finance (YFI), Decentraland 1 inch (1 inch), Curve Finance (CRV), 0x (ZRX), Basic Attention Token (BAT), Engine (ENJ), RENFIL, MakerDAO (MKR), xSUSHI, Ampleforth (AMPL), and the DeFi Pulse Index (DPI).
The suspension means that users cannot take out loans on assets or deposit into the protocol. According to the opinion, the DeFi project that decided to freeze Aave assets aims to reduce risks to Aave version 2 and promote the eventual transition to version 3 of the protocol.
A $60 million attack on Ave.
The management’s latest proposal comes as Ave faced a $60 million short attack on its CRV pool earlier this month using USDC as collateral. Due to a miscalculation of the decentralized protocol’s liquidity levels, the attack failed to pass.
“The Aave ecosystem is built with multiple mechanisms that the Aave community can deploy to cover such incidents, including a security module, ecosystem sanctuary, and DAO repository,” the protocol tweeted about the issue.
The attacker was Avraham Eisenberg, who used the Solana-based lending platform Mango Markets, referring to his actions as a “highly profitable business strategy.” In particular, he was accused of stealing money from the Fortress DAO treasury, a fork of Olympus DAO operating on the Avalanche blockchain, where he was previously the lead developer.
However, recent news has resulted in CRV posting some gains. The coin is currently trading at $0.671433, up 4.4% from the previous day. Additionally, the coin has gained more than 33 percent in the past month.