LlamaRisk Unveils Four-Stage Plan to Reopen AAVE Markets After Binance Hack

Stage Two Already Executed

Aave price moved from a 24-hour low of $123.06 to $134.36 on Saturday, a 6.7% gain across the day, while LlamaRisk published a four-stage schedule for reopening the lending markets the protocol froze after Binance disclosed a hot wallet breach. LlamaRisk, the risk service provider that assesses Aave's markets, posted the plan on Friday at 13:49 UTC, later the same day as the exchange's disclosure. The sequence starts on Aave V3: the first stage reopens the reserves frozen there; the second sets collateral factors on selected V4 assets to zero, and LlamaRisk reported that this setting was already in place when the plan went up; the third restores loan-to-value ratios on most V3 reserves; the fourth reopens the V4 reserves. Loan-to-value and collateral factor settings decide what can back a borrow and how much can be drawn against it, so restoring them is what returns a market to normal operation. Nine assets sit outside the recovery. Tether (USDT), USDC, USDT0, Polygon's POL, WAVAX, sAVAX, XAUt, PAXG and OP keep a 0% loan-to-value on V3 and a zero collateral factor on V4, which stops them from backing new borrows on either version. The Horizon RWA market was excluded from the freeze altogether. Aave's own documentation describes AAVE as the protocol's governance token and an ERC-20 asset on Ethereum, and it distinguishes the token's market price from the operational state of the lending markets. That distinction frames Saturday's session: the token traded the recovery while the protocol worked through its reopening checklist. An 11:46 UTC snapshot recorded the price at $133.97, up 6.66% over 24 hours, with the 24-hour high at $134.18; the live price has since edged past that print.

On the support and resistance levels our composite scores, the nearest strong resistance sits at $136.10, rated 94/100, while the strongest support lies at $125.56, scored 100/100. Our live monitoring puts AAVE at $134.36, up 0.4% since the newest source, with the 24-hour gain at 6.7%. Positioning is still defensive: the perpetual futures funding rate runs at -0.0126%, open interest stands at $116.18 million, and the RSI reads 41.69 with the broader trend still labeled a downtrend. Bitcoin holds 68.1% of the tracked market and the sentiment index sits at 30/100, in fear territory, so the altcoin advance is working against a cautious tape. A daily close above $136.10 would be the recovery's first strong break; losing $125.56 would hand the argument back to the sellers.

292 Reserves Frozen After the Breach

Binance said in its official notice on Friday that about $6.3 billion in tokens was withdrawn without authorization from a compromised hot wallet, with roughly $3 billion of the stolen assets frozen on-chain since. The exchange said its SAFU reserves and corporate treasury would cover the losses so that users would not absorb them, and that the investigation is ongoing. The on-chain record ties part of the damage to Aave itself. Attacker-linked wallets deposited 60 million USDT into Aave V3 as collateral and borrowed 19,762 WETH, worth about $44.6 million at the time of the borrow: in effect, a leveraged margin trading position opened against posted collateral. A separate valuation of the same position put collateral at $59.9 million against debt of $43.8 million, and LlamaRisk concluded that a routine liquidation can process it without risk to Aave suppliers. The protocol's emergency response froze 292 reserves across 16 networks, 175 on V3 and 117 on V4, halting new deposits and borrows while repayments, withdrawals and liquidations ran on. Opinion inside the Aave governance forum split. One contributor argued the protocol needs a device to cap the size or speed of new supply after a large external deposit; another countered that a total freeze was excessive for a position whose collateral exceeded its debt. Both are posts from individual users, not protocol decisions. Binance separately confirmed on Friday that it would drop 12 BTC spot pairs including AAVE, trimming the token's pair menu at the venue. The distance between the two prices this session has set against each other, the $123.06 low and the $134.36 level now, is $11.30, about 9.2%, and that gap is the yardstick the four stages will be measured by.