Traders get liquidated as Aave oracle glitch wipes out $27M
The post Traders get liquidated as Aave oracle glitch wipes out $27M appeared on BitcoinEthereumNews.com.
A misconfiguration on Aave’s CAPO oracle caused E-Mode liquidations worth 10,938 wstETH, resulting in a loss of 345 ETH. The error affected more than 30 user accounts, but Aave incurred no bad debt according to Chaos Labs CEO Omer Goldberg. Traders have suffered massive liquidations totaling $27 million after Aave’s Correlated Asset Price Oracle (CAPO) risk oracle experienced a technical glitch, causing the wstETH/stETH exchange rate cap to fall below the current market exchange rate. The error caused the exchange rate to drop by 2.85% triggering roughly 10,938 wstETH in E-Mode liquidations across 34 user accounts. Affected users will be fully reimbursed, Chaos Labs founder Omer Goldberg says Omer Goldberg, Founder of Chaos Labs, wrote on X that the incident had no impact on the Aave protocol and that all affected users will be fully compensated. He also added that the team was working on a permanent solution to prevent the incident from recurring. 1/ stETH CAPO Misconfiguration Today, a misconfiguration on Aave’s CAPO oracle caused wstETH E-Mode liquidations, resulting in a loss of 345 ETH. No bad debt was incurred, and all affected users will be fully reimbursed. More below. — Omer Goldberg (@omeragoldberg) March 10, 2026 During the incident, liquidator bots tapped 499 ETH in liquidation bonuses and in value realized through the exchange rate mispricing event. According to a publication from Chaos Labs (onchain security and risk management partner of Aave), the protocol recovered 141 ETH from liquidation bonus revenue on Buildernet refunds, as well as 13 ETH in liquidation fees. The publication highlighted that the protocol will use the recovered funds, along with additional funds from the protocol’s DAO treasury, to reimburse affected users who were liquidated due to the error. The security platform said the differing update constraints at the smart contract level were the…
Filed under: News - @ March 11, 2026 1:19 pm