DeFi United Reaches $300M as Consensys, Lubin Pledge 30K ETH

Circle Ventures, Consensys, and Ethereum co-founder Joseph Lubin announced support for the DeFi United initiative on Monday, a coordinated effort to cover losses from the Kelp DAO exploit. Together, Consensys and Lubin have committed 30,000 ETH, representing one of the largest single contributions to the recovery effort, according to Aave’s announcement. With these latest pledges, DeFi United has now raised more than 132,000 ETH worth over $300 million.

DeFi United Campaign Overview

DeFi United is a community-led initiative designed to restore backing for rsETH and stabilize market conditions following the Kelp DAO exploit. Circle Ventures, the venture arm of USDC stablecoin issuer Circle, announced it is purchasing AAVE tokens to help alleviate the negative impacts of the recent exploit, according to a post on social media.

“Strong DeFi infrastructure does not build itself,” Circle Ventures said. “Aave is helping to shape the future of onchain finance, and we’re backing that ecosystem and the entire community built around it.”

Aave stated that the contributions from Consensys and Lubin “are a substantial component of the broader DeFi United effort to restore rsETH’s backing and normalize market conditions, and the recovery would not be progressing as it is without them.” Consensys-backed Ethereum treasury firm Sharplink will also provide strategic advice to the recovery effort.

Exploit Context

The Kelp DAO shortfall originated when an attacker minted unbacked rsETH through a compromised LayerZero bridge and used it as collateral on Aave to borrow real assets, leaving the protocol with bad debt. Contributions to DeFi United are directed toward closing the remaining shortfall created by this attack.

Additional Pledges and Contributions

Aave service providers have proposed contributing 25,000 ETH (worth nearly $58 million) from the protocol’s DAO to DeFi United. Lido DAO proposed contributing up to 2,500 ETH, while Ether.fi proposed up to 5,000 ETH. Kelp has pledged 2,000 ETH. According to X user DCF GOD, if all proposals pass, the shortfall would already be filled. Dozens of unnamed individuals have also contributed smaller amounts of ETH and stablecoins.

Broader DeFi Market Context

Data from The Block shows that total value locked on DeFi protocols currently sits at approximately $82 billion, down over 25% from the $110 billion seen at the start of the year.