Aave's Ethereum v2 version has disabled the CRV borrowing function in response to the recent Curve vulnerability, aiming to prevent malicious traders from promoting serial liquidation through panic and borrowed CRV shorting.
In an attempt to protect its users from the impact of the recent Curve vulnerability, Aave has decided to disable the CRV borrowing function on its Ethereum v2 platform. The measure was taken following the approval of the AIP-125 proposal by Aave governance, which allows the protocol to prohibit the borrowing function of specific assets in case of emergencies.
There is currently over 300 million CRV supply in Aave v2, with about 95% coming from CRV founder Michwill's supply. Before disabling the function, only around 35 million CRV had been borrowed. The decision to disable the CRV borrowing function aims to prevent predatory traders from taking advantage of the Curve vulnerability by shorting borrowed CRV and inciting panic to cause serial liquidations.
As the DeFi ecosystem continually faces security and vulnerability challenges, protocols such as Aave must take preventive measures to safeguard users and maintain the integrity of their platform.
