Aave Freezes Lending Reserves as Arbitrum Locks Binance-Linked Funds

Aave froze reserves on 16 Aave V3 and four Aave V4 networks after a wallet linked to the Binance hot-wallet exploit borrowed 19,762 wrapped Ether (WETH), while Arbitrum moved related assets to a frozen address.

The transactions ran from 5:42 p.m. to 7:04 p.m. ET Oct. 29 (21:42–23:04 UTC), freezing 175 reserves on V3 and 117 on V4. The wallet had supplied $60 million in Tether (USDT) before borrowing WETH worth about $44.6 million.

Users could not open new supply or borrowing positions or add collateral, but repayments and withdrawals remained open, and liquidations continued.

Separately, Arbitrum transferred 8,425 Ether (ETH) and 74,559,805.2 Arbitrum (ARB) to a frozen address on Arbitrum One. Arbitrum said the move affected no other users or applications.

Binance estimated the incident’s impact at about $6.3 billion in an update at 10:23 p.m. ET Oct. 29 (02:23 UTC Oct. 30). Its initial Ethereum hot-wallet transfer occurred at 4:24 p.m. ET Oct. 29 (20:24 UTC) and included 167,464 ETH and about 63 other tokens.