Overview
- Blockchain traces show a large unauthorized outflow began on Thursday, October 29, and a substantial portion landed on Avalanche prompting rapid protocol responses.
- Aave froze its Avalanche lending markets to block new supply and borrowing while still permitting repayments, withdrawals and liquidations.
- Tether and Circle each froze addresses linked to the incident, with announcements totaling roughly $1.5 billion and $823 million in frozen stablecoins respectively.
- On‑chain records and analysts say the attacker posted about $60 million in USDT as collateral on Aave and executed two borrows that produced about 19,762 ETH before the market freeze.
- Investigations by Binance and blockchain forensics firms are ongoing, Binance says user funds are secure, and the episode highlights friction between issuer blacklists and DeFi emergency controls that may harm ordinary users and complicate recovery.