Aave V2 Users Temporarily Unable to Access $120M on Polygon After Governance Bug



23 May 2023 08:46, UTC


Reading time: ~2 m

Some Aave version 2 (V2) users are temporarily unable to access their funds stuck on the decentralized exchange’s deployment on the Polygon blockchain after a strategy containing a faulty bug went live last week.

Decentralized finance (DeFi) protocol Aave allows users to lend and borrow tokens on several blockchains, such as Ethereum, Polygon and Avalanche. The extent of this sometimes causes compatibility bugs to arise, temporarily rendering parts of the platform inaccessible to users and leave funds stuck.

An upgrade last week to the “ReserveInterestRateStrategy” caused the issue, security firm BlockSec tweeted. Affected tokens include tether (USDT), bitcoin (BTC), ether (ETH) and polygon (MATIC).

The ReserveInterestRateStrategy contract is a core contract in Aave that helps calculate and apply interest rates to borrowed loans.

“The root of the problem is that, for legacy reasons, the v2 version used on Aave v2 Polygon (and Avalanche) is slightly different from Aave v2 Ethereum, in regards to the interface used by the LendingPool to call the rate strategy of an asset,” Aave community member BDGLabs explained.

“The new interest rate strategies applied to those assets respect the interface of Aave v2 Ethereum, but not v2 Polygon, so when the LendingPool queries the strategy for the current rate, this call reverts, and so does the action “wrapping” it (e.g. deposit, borrow, etc),” the firm added.

A fix is already in place, voting on by community members and users can top up funds on the network, an Aave governance proposal shows.

Other versions of Aave on Polygon continue to work smoothly as of Tuesday. AAVE tokens were up 2.7% in the past 24 hours, in line with a broader market jump.

Sourced from cryptonews.net.

Leave a Reply
Previous Post

Here’s Why Bitcoin Derivatives Surged to $56,000 on Bitfinex

Next Post

Equilibria and Frax Finance Announce Partnership on DeFi Innovation

Related Posts