After a community vote today, Aave Improvement Proposal (AIP) 44 was approved. The AIP-44 will address a vulnerability discovered in the defi protocol about a week ago. The vulnerability could have been exploited with xSUSHI as collateral, but with the AIP-44 approval, borrowing for xSUSHI and DeFi Pulse Index (DPI) is no longer available.
The proposal was expected to pass with 575,000 votes in favor and only one vote against it.
1/7 Today @gauntletnetwork submitted an AIP proposing to disable the borrow function for $xSUSHI and $DPI on V2 of the Aave Protocol as a precautionary measure. The AIP also will disable borrowing of AMM LP tokens on the Aave Protocol AMM Market as an extra safeguard. A thread👇
— Aave (@AaveAave) October 29, 2021
Previously, Aave claimed that the vulnerability discovered in the XSushi collateral could not be exploited; however, Yearn finance engineer Banteg revealed that the vulnerability was available for 160 days. The vulnerability can finally be patched now that the improvement proposal has been approved.
Justin Sun’s $4.5 Billion is the focus of everyone’s attention.
Justin Sun, the founder of Tron, made headlines a few days ago after Aaave discovered the vulnerability and proposed the AIP-44 proposal. Sun withdrew assets worth $4.5 billion from the Aave protocol. Many people thought the fund movement was due to a recent exploit on Cream Finance, which resulted in the loss of millions of dollars in assets. Along with Sun, several other investors exited the Aave protocol as its total value locked fell by 20%.
All eyes are now on Sun and whether he will redeposit all of the assets now that the vulnerability has been patched or not. AAVE’s current TVL is $13.83 billion, down from a monthly high of more than $20 billion.
The price of AAVE remains above $300, as the recent vulnerability and withdrawal of funds from the protocol had little impact on its price. In May of this year, the defi protocol reached an all-time high of $666. As there is some form of hack or scam on one protocol or another, the growing number of Defi exploits continue to put a dent in the Defi ecosystem’s growing popularity. Cream Finance and BXH are two of the most recent.