The DeFi community is divided on how they perceive Mark Zeller’s message when he wrote, “If you have WETH on Aave V3 Core, withdraw now, ask questions later” on Saturday, April 18.
The two options: a real alarm or an act of sabotage.
However, a few hours later, more than $6.6 billion left Aave, with stablecoin borrowing rising to 15%, causing a major liquidity crisis.
That warning came from Zeller, founder of the Aave-Chan Initiative (ACI), who spent months… Aave Labs is publicly fighting back Before announcing his departure in March, he added an unmistakable edge to an already turbulent situation.
User X responded to Zeller’s initial post, writing“I think it’s your responsibility to add actual information and context here if you’re going to make this claim that’s causing people to panic.”
Supporters described it as a timely nudge from a well-connected insider.
Was Zeller sounding the alarm or fanning the flames?
And in subsequent posts Zeller announced The situation is “under control” and it announced the immediate termination of ACI’s Frontier ETH staking program, and offered to make all ETH from validators available to Aave’s DAO to help protect WETH depositors. “It won’t help much, but it seems like the right thing to do now,” he wrote.
For its part, Spark’s MonetSupply wasn’t harsh in drawing a competitive lesson. Spark had stopped using rsETH as collateral in January and maintained maximum borrowing rates in its ETH market, a policy that was “not very popular among eth fans.” I confessbut it leaves SparkLend with ample liquidity while Aave markets it across the mainnet and Arbitrum, Plasma, Mantle, and Base are closed.
Aave’s total value locked (TVL) has fallen from more than $26.3 billion as of April 18 to about $19.8 billion. Its token, AAVE, is currently down more than 18% over the past 24 hours, trading at around $92.2 as of the time of writing.
What really happened to Avi, and how serious was the damage?
The crisis started on Kilbdaw,Ethereum-based liquid recovery protocol.
On April 18, an attacker exploited the Vulnerability in KelpDAO A cross-chain bridge based on LayerZero, which enabled them to manipulate the protocol’s messaging layer to issue 116,500 rsETH tokens, approximately 18% of the total circulating supply, worth approximately $292 million.
according to EmberCN“The amount of funds withdrawn from Aave was $6.6 billion, half of which ($3.3 billion) was stablecoins,” while Justin Sun alone withdrew about 65,584 Ethereum, worth about $154 million.
EmberCN later posted that Sun withdrew 53,660 ETH ($125 million) from Aave in the early hours of the morning and deposited it into Spark.
Moneysupply.ethThe head of strategy at Spark, a direct competitor to Aave, warned that with ETH usage locked in at full capacity, borrowers using ETH as collateral for stablecoin loans cannot unwind their positions even as stablecoin borrowing rates rise.
Why did Zeller leave Aave?
Zeller founded ACI as Aave’s primary governance and business development delegate, making him one of the most influential voices in the protocol for years. But the relationship between the DAO founder and Aave Labs leadership became severely strained in the final months of 2025.
There has been a management dispute over Aave Labs’ decision to redirect swap fees on its platform away from the DAO’s treasury and into a Labs-controlled wallet, a move that critics viewed as a privatization of the protocol.
Zeller claimed that the wallet addresses associated with Labs skewed a significant governance vote in favor of Labs and declared that “there is no role for an independent service provider in an environment where the largest budget recipient has undeclared voting power and uses it in its own proposals.”
ACI began liquidation around this time, announcing that it was leaving. However, it’s not alone, as BGD Labs, the development team behind Aave V3’s core codebase, and Chaos Labs, Aave’s risk custodian, have also announced their exit.
