Aave Reopens Ethereum Core Market After Freeze
A roughly $44.6 million WETH borrowing on the lending protocol prompted guardians to freeze markets before the Ethereum Core market reopened.
Updated on Nov. 7, 2026 in Cybersecurity
Aave's guardians froze markets about 40 minutes after a wallet borrowed about $44.6 million in WETH against 60 million USDT collateral over roughly three minutes. The Ethereum Core market has since reopened, with new deposits and borrowing disabled during the freeze.
Why it matters
The incident exposes how quickly large borrowings can drain a lending protocol and why guardians rely on emergency freezes to contain them. It also shows why LlamaRisk is developing time-based borrowing limits to slow such activity.
On-chain records show the wallet borrowed 19,762 WETH against 60 million USDT in roughly three minutes, and a liquidator later repaid about 9,884 WETH for about $24.38 million in USDT. The records do not establish the wallet owner's identity or intent.
The players
LlamaRisk
LlamaRisk is a risk management firm that advises DeFi protocols such as Aave on parameters including borrowing limits and market reopenings.
Aave
Aave is a decentralized lending protocol on Ethereum that allows users to borrow and lend crypto assets against collateral.
The details
Aave's guardians began freezing markets about 40 minutes after the borrowing, allowing users to repay loans or withdraw collateral but disabling new deposits and borrowing. LlamaRisk had previously outlined lower borrowing caps ahead of a phased market reopening, and USDT and USDC deposits in the Ethereum Core market add no borrowing capacity because their loan-to-value ratios are zero.
Timeline
October 29, 2025: Wallet borrowed 19,762 WETH against 60 million USDT collateral.
November 4, 2025, 14:49 UTC: Liquidator repaid about 9,884 WETH from the position.
November 5, 2025, 16:04 UTC: Position still owed about 9,885 WETH against USDT collateral.
Tech Race
Aave's guardian-controlled freeze mechanism was used here to halt a roughly $44.6 million WETH borrowing after about 40 minutes. LlamaRisk's proposed time-based borrowing limits would instead restrict how much can be borrowed within set periods, moving the protection upstream of emergency freezes.
Users of the Ethereum Core market could repay loans or withdraw collateral during the freeze, but new deposits and borrowing were disabled. Deposits of USDT and USDC in that market add no borrowing capacity because their loan-to-value ratios are zero.
The takeaway
Time-based borrowing limits could slow large withdrawals of liquidity before emergency freezes become necessary. Users of lending protocols should check collateral and borrowing parameters before relying on available liquidity.
Further reading
For more on the security risks facing decentralized lending platforms, see Cybersecurity.
Source note: This article includes information reported by TokenPost.
