Aave Releases Technical Plan to Restore rsETH Backing as Defi United’s Coalition Expands
Key Takeaways:
Seven addresses linked to the exploiter currently hold active rsETH-backed positions across Aave and Compound, representing approximately 107,000 rsETH of the original 116,500 stolen. Defi United’s plan runs on two parallel tracks, the first being restoring rsETH’s backing ratio and then clearing the affected positions to recover the excess collateral.
Restoring the 1.07 ETH Backing Ratio
For rsETH to resume normal market operations, its backing must be restored to its nominal Kelp rsETH exchange ratio of 1.07 ETH. Defi United has secured the ETH commitments required to achieve this, with final execution subject to governance approvals and completion of definitive agreements.
The restoration process converts committed ETH into rsETH in tranches, a deliberate risk-management structure, before depositing it into the bridge lockbox contract. Both Layerzero and Kelp have implemented additional security measures ahead of bridge resumption, though the plan notes residual risk remains until those measures are validated in production.
Controlled Liquidation to Clear Exploiter Positions
Clearing eight affected positions across Aave’s Ethereum Core and Arbitrum markets requires governance proposals to pass and execute on both networks. The mechanism temporarily adjusts the rsETH oracle price to enable efficient liquidation, generating a controlled deficit that is subsequently cleared using ETH recovered from the redeemed rsETH collateral. All configuration adjustments are temporary and fully reverted after completion, with no persistent changes to the Aave protocol.
This track targets the recovery of approximately 13,000 ETH currently locked in Aave positions. Compound is running a parallel clearance of the exploiter’s position with Defi United, providing the necessary liquidity, a process expected to recover a further 16,776 ETH on that side.
That said, execution carries governance risk as deliberate interference by the exploiter, who retains active positions on both Ethereum and Arbitrum, could complicate the liquidation sequence and require additional steps. Defi United has structured the plan to restore rsETH backing without socializing losses, though that outcome depends on clean execution across all governance and liquidation steps.
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