Crypto Hack Puts Big Lender in Turmoil
Decentralized lender Aave faces a run after making bad loans tied to a hack.
The latest in a series of crypto hacks has spread turmoil across the market, toppling the biggest lender in the industry, freezing billions of dollars in assets and causing big losses for highly leveraged traders.
The hack, which involved $290 million of fraudulent tokens, began at a little-known startup but the impact quickly spread to Aave, which accounts for about a third of the decentralized crypto lending market. It caused the equivalent of a bank run and sent lending rates soaring to 15%. Aave is a decentralized lending platform, or protocol.