Aave DAO Proposes 25,000 ETH to Support rsETH Recovery Plan

• Aave DAO proposes 25,000 ETH to help close rsETH shortfall after Kelp DAO bridge exploit.
• Combined pledges, freezes, and Mantle credit facility aim to fully cover the remaining gap.
• Exploit minted 116,500 rsETH, leaving Aave exposed to bad debt on V3 markets.

Aave DAO has introduced a governance proposal to allocate 25,000 ETH from its treasury to support a recovery plan following the April 18, 2026, rsETH bridge incident tied to Kelp DAO.

The proposal, published as an ARFC, outlines a fixed contribution aimed at restoring asset coverage while aligning with a broader DeFi United recovery framework that includes protocol donations, asset freezes, and a credit facility. The initiative comes as the estimated deficit has narrowed from an initial 163,183 ETH to about 75,081 ETH following partial recoveries and pledged support.

Recovery Contributions Narrow Funding Ga…

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