How KelpDAO's Exploit Left Aave With $200M Bad Debt

Description

On April 18, 2026, attackers minted 116,500 rsETH tokens backed by nothing and used them to drain $193 million in real ETH from Aave, triggering the protocol's worst weekly outflow on record. In this episode, Carlos, Luke, and Shaunda from Blockworks break down exactly how the exploit worked, why Aave's architecture made it possible, and what it means for the future of DeFi lending. The ghost collateral is gone. The questions it left behind are not.