Aave-led DeFi United unveils $303M plan to restore rsETH

DeFi United, an Aave-led coalition, published a technical plan to restore backing for rsETH following the April 18 Kelp DAO hack. The group reported it has secured 132,650 ETH in capital and credit commitments, valued at about $303 million.

The plan calls for converting the committed ETH into rsETH in controlled tranches to limit market disruption. Once enough rsETH is in place, governance-controlled oracle prices would be temporarily adjusted to allow protocol-safe liquidations of the attacker’s collateral on Aave and Compound.

DeFi United estimates it could recover roughly 13,000 ETH from Aave’s Ethereum and Arbitrum markets and about 16,776 ETH from Compound through the proposed liquidations.

The exploit on April 18 resulted in the minting and theft of 116,500 rsETH, about 18% of the token’s circulating supply. Attackers deposited 89,567 unbacked rsETH as collateral and borrowed 82,650 WETH and 821 wstETH across Aave and Compound. The Arbitrum Security Council has frozen roughly $71.5 million traced to exploiter addresses.

Major backers include Consensys and founder Joseph Lubin, who pledged up to 30,000 ETH, Aave Labs CEO Stani Kulechov, who committed 5,000 ETH, and Lido, which proposed allocating up to 2,500 stETH. The total commitments amount to 132,650 ETH.

Aave warned that deliberate interference by the attacker could complicate recovery and leave residual deficits that require further liquidation steps. DeFi United described the effort as a governance-led, coordinated relief mechanism rather than a unilateral bailout.

Joseph Lubin described the effort as ‘a broad, coordinated response to protect users and strengthen the infrastructure we’ve all helped build.’