Aave devs propose freezing Fantom integration, citing lack of traction and potential vulnerability

The Fantom market on Aave v3 adds just $30 each day to the DeFi protocol’s treasury; developers are also concerned that the integration creates security risks.

On Tuesday, Marc Zeller, integration lead at decentralized finance (DeFi) borrowing and lending protocol Aave, proposed to freeze the platform’s v3 Fantom market. Created in 2018, Fantom is a directed acrylic graph smart contract platform that provides DeFi services and on which Aave is currently bridged. 

Zeller explained the rationale for removing the Fantom bridge:

“After the Harmony bridge event and the recent Nomad bridge exploit, the Aave community should consider the risk/benefits of keeping an active Aave V3 market on Fantom as this network is dependent on any swap (multichain) bridge.”

Zeller further explained that the Aave v3 Fantom market did not gain noticeable traction, with a current market size of $9 million and $2.4 million of open borrowing. In comparison, the Aave protocol has a total value locked of $3.48 billion. Meanwhile, the Fantom market on Aave only generates approximately $300 per day for the borrowing-lending protocol, of which $30 goes to the Aave Treasury.

If passed, the Aave Improvement Protocol would allow users to repay their debts and withdraw but block further deposits and borrowings in this market. After five days, a community vote will be held to determine the future of Aave v3 Fantom. The Aave team wrote:

“The risk of exposing users to potentially losing millions of $ due to causes exterior to intrinsic Aave security is considered not worth the $30 of daily fees accrued by the Aave treasury.”

Related: Backlash as Harmony proposes minting 4.97B tokens to reimburse victims

Multichain bridging, while praised by some as a pinnacle of interchain communications, has been criticized by skeptics such as Vitalik Buterin for its supposed fragility. Earlier on Tuesday, the Nomad token bridge was drained for $190 million after hackers discovered a single code exploit that anyone could replicate, leading to a “decentralized robbery” as other users joined in on the initial hacker’s siphoning of funds. 

Related Posts

Crypto-focused venture firm Dragonfly acquires hedge fund: Bloomberg

Amid the grueling bear market for Bitcoin, Ether and altcoins, the cryptocurrency industry is undergoing consolidation. Cryptocurrency venture firm Dragonfly has acquired a digital asset-focused investment fund…

Binance distances from WazirX as Indian regulators keep chasing crypto

The ownership of WazirX became a hot topic as CZ claimed the deal never went through, but three years later, there’s still no clarity. The Twitter exchange…

Saddle Finance Redefines Trading of Pegged Value Assets with Ease And Security

Are you ready to Saddle up? A decentralized finance platform architectured to facilitate efficient trade between pegged crypto assets is now one of the most prominent names…

How Revolut Will Launch New Crypto Platform, Cyprus Grants Authorization

Per a report from Atlfi, fintech company Revolut will be able to offer more crypto products to its customers. The one-stop app for “all things money” has…

Biggest Movers: SHIB Remains Near 3-Month High, Whilst LEO Hits 2-Week High 

Shiba inu remained close to a three-month high to start the week, after breaking out of a key resistance level over the weekend. The surge of the…

Bitcoin Dominance Rate (BTCD) Continues to Fall as Ethereum (ETH) Increases

The Bitcoin dominance rate (BTCD) has broken down from its long-term bullish structure, while the ETH/BTC chart shows potential for upside. Between May and Dec 2021, BTCD…

Generated by Feedzy