Developers have assured that all funds are secure, and they are currently working on a governance proposal to fix the problematic strategy.
Certain users of Aave version 2 (V2) are currently facing a temporary issue where they cannot access their funds on the Polygon blockchain. This problem arose when a flawed bug was introduced in a strategy that was implemented last week.
Aave is a decentralized finance (DeFi) platform that enables users to lend and borrow tokens across different blockchains like Ethereum, Polygon, and Avalanche. However, due to the complex nature of supporting multiple blockchains, compatibility bugs can occur. These bugs may temporarily prevent users from accessing certain parts of the platform and result in funds being temporarily inaccessible.
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According to a tweet by security firm BlockSec, a recent upgrade to the “ReserveInterestRateStrategy” triggered the problem. This issue has impacted tokens like tether (USDT), bitcoin (BTC), ether (ETH), and polygon (MATIC).
The Reserve Interest Rate Strategy contract is an important part of Aave. It is responsible for calculating and applying interest rates to loans that users borrow from the platform.
According to BDGLabs, a member of the Aave community, the issue stems from a difference in the way the v2 version of Aave is implemented on Polygon and Avalanche compared to Ethereum. Specifically, there is a variation in the interface used by the LendingPool to interact with the rate strategy of an asset.
The problem arises because the new interest rate strategies, which are designed for Aave v2 Ethereum, do not align with the interface of Aave v2 Polygon. As a result, when the LendingPool tries to retrieve the current rate from the strategy, this action fails, leading to the failure of related actions like deposits, borrowing, and so on.
.@AaveAave the latest upgrade of ReserveInterestRateStrategy in Aave V2 (Polygon) has caused a temporary halt of the protocol, impacting assets worth ~$110M!
The root cause is the new ReserveInterestRateStrategy is only compatible with Ethereum, not compatible with Polygon. https://t.co/kg5696QNPo pic.twitter.com/Ze3zSBS8Ck— BlockSec (@BlockSecTeam) May 19, 2023
A solution has already been implemented through a voting process involving community members and users. As per an Aave governance proposal, users have the ability to add more funds to the network.
As of Tuesday, other versions of Aave on Polygon are functioning without any issues. During the past 24 hours, AAVE tokens experienced a 2.7% increase, which is consistent with the overall rise in the market.
Important: This article is intended solely for informational purposes. It should not be considered or relied upon as legal, tax, investment, financial, or any other form of advice.
