Aave Proposal Would Cut Off Fantom Amid Security Fears
Categories: Crypto News US
AaveProposal Would Cut Off Fantom Amid Security Fears
For example, the recent Solana hack results have againreminded people about the importance of hardware wallets. We now know that over15,000 crypto wallets were affected, and approximately $4.6 million was caught.Another recurring misfortune has been bridge hacks. Bridges are key pieces of cryptoinfrastructure that allow users to move funds between blockchains. For example,the original asset on an avalanche cannot exist at harmony without the help ofa bridge.
And if you are a believer in the so-called multi-chainuniverse, bridges are essential to that thesis. Unfortunately, these platformshave been going completely bad as of late. The latest episode revolves aroundNomad's nearly $190 million hack earlier this week. But there have been manyothers, such as Axi Infinity's Ronin Bridge ($622 million), thewormhole hack ($320 million) in February, and the hack of a bridge betweenHarmony and Ethereum ($100 million).
Only those three hacks resulted in the theft of more than $1billion, although blockchain firm Chainalysis estimates that in all 13 bridgehacks this year, the total is closer to $2 billion. “This action will protect userson Phantom by disabling the ability to deposit or borrow assets in the Aave V3Markets, while still allowing for loan repayment, liquidation, withdrawal andinterest rate changes,” it reads.
If you're just holding out, Aave lets you lend dormant cryptoto earn a small percentage off the small fee you pay for the protocol to do so.Phantom is a layer-1 blockchain built using a Proof-of-Stake (PoS) consensusmechanism and optimized for speed. Like Ethereum, Phantom has many differentDeFi apps. So even Ethereum-first DeFi apps, such as Away, have made theirservices available on Phantom.
"The Phantom Aave V3 market has not gained noticeable traction withthe current market size of $9M and $2.4M open lending positions; this generatesan average $300 fee per day for the protocol in the market (~ of the daily feefor Aave Treasury). $30)," the proposal reads, adding that ifthe Phantom Bridge breaks down or is hacked, users will have nothing left. Thiswouldn't be the first time Aave has shut down the Crypto Bridge.
After that Harmony Bridge hack, Away did the same;Unfortunately, they had already been affected. Now, the discussion is still inthe proposal stage, but on Monday it will go to the DAO voting platformSnapshot for an official vote on the result. Also, an Ethereum merge is on thehorizon and layer-2 networks on Ethereum are gaining traction. As amulti-series future promised lower fees and higher speeds, it probably won'tmatter in the end.