LayerZero Pledges $23M to DeFi Recovery After Major Exploit.
The firm has pledged over 10,000 ETH, worth approximately $23 million, to an Aave-led recovery initiative. Specifically, half of the amount (5,000 ETH) will be donated directly. Meanwhile, the remaining 5,000 ETH will be used to support liquidity on Aave.
The response follows a $292 million exploit on April 18 involving a sophisticated RPC poisoning attack that compromised LayerZero’s verification system. Attackers exploited the vulnerability to forge cross-chain messages, resulting in the minting of unbacked rsETH on Ethereum.
Roughly 107,000 rsETH were subsequently deposited into Aave lending positions, creating a significant bad debt burden for the protocol.
Alongside its financial commitment, LayerZero also plans to improve liquidity support for GHO, Aave’s native stablecoin. In addition, it will collaborate with Aave and other DeFi players on refining omnichain token standards for lending infrastructure.
