Aave’s core markets hit 100% utilization at once, and that's not a good thing

What Happened

Aave, a major decentralized lending platform, froze Tuesday after hitting 100% utilization across all markets, leaving approximately $5 billion in stablecoins USDT and USDC locked with no withdrawal liquidity. The crisis followed a $292 million Kelp DAO exploit on April 18, triggering a bank-run scenario that saw $6.6 billion exit the protocol within 24 hours. Liquidations cannot process, creating severe protocol vulnerability.

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