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Aave to Reimburse Users After $27 Million in Liquidations Tied to Oracle Misconfiguration

A brief CAPO risk‑oracle error undervalued wstETH by about 2.85%, triggering automated liquidations even as the core market oracle remained accurate.

Defi lending platform aave sees a rare $27 million liquidations after a price glitch
What happened in the aave oracle incident? $26m liquidations explained
Aave users lose $26M after wstETH oracle misconfiguration triggers liquidations
Aave wsteth glitch forces $27m in liquidations and compensation

Overview

  • Chaos Labs traced the event to a mismatch between CAPO’s snapshot ratio and timestamp, which capped the wstETH exchange rate below market.
  • Roughly 10,938 wstETH across 34 accounts were liquidated, with third‑party liquidators earning about 499 ETH, and the protocol reported no bad debt.
  • Aave and Chaos Labs corrected the configuration, temporarily lowered wstETH borrow caps, and restored correct pricing for the asset.
  • Recovered funds of about 141.5 ETH plus DAO treasury resources (up to roughly 345 ETH) will be used to fully reimburse affected users.
  • Lido confirmed wstETH and its protocol operated normally, and market reaction included a modest AAVE price dip near $111 as the platform remained operational.