The post AAVE Price Drops After DeFi Exploit Triggers Liquidation Cascade — Is $85 Next? appeared first on Coinpedia Fintech News
Aave is dealing with the aftermath of a DeFi exploit, but the real damage came after. The event sparked a liquidation cascade that wiped out leveraged positions and pushed the price into a weak demand zone. Now, with support under pressure and traders reloading positions, the market looks far from stable. Is this where the AAVE price finds a floor—or is another move lower already in motion?
Exploit Triggered the Drop — Aave Moves to Contain Risk
The trigger came from an exploit tied to rsETH collateral (linked to KelpDAO), which exposed a structural weakness rather than a direct flaw in Aave itself. Attackers used rsETH within Aave’s lending markets to borrow large amounts of ETH, and when those positions turned unstable, it left the protocol with bad debt exposure. This wasn’t a smart contract hack on Aave — it was a case of collate
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