Did North Korean Hackers Just Play Aave Twice?

[Alpen]

The Lazarus Group's attack on the Kelp platform may have generated additional profits for North Korean hackers by shorting the AAVE token. Five days after the launch of the V4 protocol with its new 'hub-and-spoke' architecture, the attackers timed the deposit of 89,567 'non-existent' rsETH into the Aave death contract.

This triggered a five-day rally in AAVE, which ended with the Kelp hack. This allowed the hackers to earn a 26% profit on their short position. The Lazarus Group had previously employed a similar strategy with the Ronin bridge, where the hack was accompanied by short positions on AXS and RON in anticipation that the news would cause the price to crash.

In that case, however, Ronin validators remained unaware for a week that $600 million had been stolen, and the hackers’ short positions were closed via margin calls. In contrast, news of the AAVE hack became public instantly, sending prices plummeting to yearly lows.

The resulting crisis of user confidence led to an outflow of liquidity from the platform. DeFiLlama data shows a loss of $6.6 billion in TVL. According to Cryptomus analysts, investors are continuing to sell AAVE tokens and the inflow of coins to exchanges is growing.

[shinratensei_]

They are trying to extract profit from all sides, but this kind of thing won't even become possible if the contract isn't hacked in the first place.

There has been tweets about how white hat bug bounty hunters are getting underpaid severely for their bug reports, I think they should work on that to prevent this kind of thing from happening.
It's better to pay white hat bounty hunters some money than getting entire contract drained.

[Alpen]

They are trying to extract profit from all sides, but this kind of thing won't even become possible if the contract isn't hacked in the first place.

There has been tweets about how white hat bug bounty hunters are getting underpaid severely for their bug reports, I think they should work on that to prevent this kind of thing from happening.
It's better to pay white hat bounty hunters some money than getting entire contract drained.

White hats wouldn't have helped here. There was no code bug; it was simply an issue of having too few validators.

[shinratensei_]

White hats wouldn't have helped here. There was no code bug; it was simply an issue of having too few validators.

Although this is true that white hats wouldn't have helped since it's not code bug and 1/1 DVN is apparently intended mechanism that is even the LayerZero themselves said they are against it. But still, there is turmoil about how severely underpaid white hats are after disclosing bug that could potentially put hundred million dollar at risk and only getting $3k for that. Honestly there were critics about 1/1 DVN setup by wormhole co founder before rsETH exploit happened.

If these aren't fixed, those hackers will keep doing the same exact thing you mentioned. Though yeah, the 1/1 DVN is problem on the KelpDAO themselves not a code problem.