Aave oracle failure leads to $26 million worth of wstETH being improperly liquidated

CycleProphet · 2026-03-11T02:06:16+00:00

Aave experienced an oracle failure on March 10 on Ethereum, resulting in the improper liquidation of $26 million worth of wstETH positions. The issue was caused by a misconfiguration of the asset price oracle, affecting 34 accounts and liquidating approximately 10,938 wstETH tokens. A compensation plan is underway.

CycleProphet

2026-03-11 02:06:16

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Deep Tide TechFlow News, on March 11, according to The Block, Aave experienced a temporary oracle failure on March 10 on its Ethereum Core and Prime instances, resulting in the improper liquidation of approximately $26 million worth of wstETH positions.

A post-incident analysis report released by Chaos Labs, Aave’s main risk management service provider, indicated that the issue stemmed from a configuration error in the related asset price oracle (CAPO). Due to inconsistencies between the snapshot ratio and the snapshot timestamp, the oracle reported an exchange rate cap of about 1.1939, significantly lower than the actual market rate of approximately 1.228, leading to erroneous liquidations of E-Mode positions.

The event affected about 34 accounts, with a total of approximately 10,938 wstETH liquidated. Chaos Labs stated that a compensation plan is underway, which will use 141.5 ETH recovered from the incident and up to 345 ETH from the DAO treasury to compensate affected users. The report emphasized that this incident was not due to a flaw in CAPO or off-chain risk oracle design, but resulted from parameter misalignment caused by on-chain configuration inconsistencies.

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