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Aave Sees $27 Million in Liquidations After wstETH Oracle Pricing Issue

Aave Sees $27 Million in Liquidations After wstETH Oracle Pricing Issue

According to Chaos Labs, a temporary oracle failure on March 10 affected Aave’s Ethereum Core and Prime markets, triggering roughly $26 million in wstETH liquidations and prompting partial fund recovery for compensation.

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Fact Check
The event is documented by major crypto news outlets and confirmed by the risk management firm (Chaos Labs) and the protocol founder (Stani Kulechov). The specific technical details regarding the CAPO risk oracle mismatch and the $27 million figure are consistent across reports.
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Summary

Aave’s March 10 oracle incident triggered about $26 million in wstETH liquidations across its Ethereum Core and Prime markets, affecting 34 accounts and liquidating 10,938 wstETH. According to Chaos Labs, the event was caused by a CAPO configuration mismatch that created a 2.85% pricing deviation. Earlier reporting and official statements had described the losses at roughly $27 million and about 345 ETH, with no bad debt created and affected users set to receive full compensation. Chaos Labs said 141.5 ETH has been recovered for compensation.

Terms & Concepts
  • Oracle: A blockchain data service that supplies external price information to DeFi protocols for collateral valuation, borrowing limits, and liquidations.
  • wstETH: A wrapped version of Lido’s staked Ether token that represents staked ETH plus accrued staking rewards and is widely used as DeFi collateral.
  • CAPO: Aave’s Correlated-Assets Price Oracle mechanism, designed to constrain pricing for correlated assets such as yield-bearing tokens to manage risk.