The cryptocurrency lending protocol Aave (AAVE) announced its new move following an incident on March 12th where an anonymous user exchanged $50.4 million worth of aEthUSDT for approximately $36,000 worth of aEthAAVE.
Accordingly, Aave announced that it has launched Aave Shield to protect swap transactions.
According to The Block, Aave (AAVE) has introduced a protection feature called Aave Shield to prevent high-risk trades with significant price impact.
This decision comes after a major swap loss event. When this feature is active, swaps with a price impact exceeding 25% will be automatically blocked.
To proceed with this type of operation, the user must manually disable the Aave Shield protection function.
This event is considered the largest transaction loss of its kind in DeFi history.
*This is not investment advice.
