DeFi lending protocol Aave is deliberating ways to mitigate risk on its Aave V2 ETH platform after a $60 million short attack.

On Tuesday, Mango Markets exploiter Avraham Eisenberg modified into as soon as liquidated for $10 million after an unsuccessful strive at shorting Curve tokens on Aave.

“The patron has been totally liquidated, however no topic this, Aave has accrued a significant smaller (~$1.6M USD) harmful debt intention as of this present day’s CRV mark,” stated Aave developer lLlamaxyz on the governance forum.

Even though Aave says the harmful debt is isolated to the CRV market, the protocol proposed recapitalizing the system to construct CRV entire. The proposal requires the usage of Aave’s risk management unit, Gauntlet’s insolvency fund, and Aave’s collector contract to duvet the excess debt.

The protocol also plans to revisit a discussion on the probability/return tradeoffs of allowing users to short obvious sources. While risk mitigating functions like borrow caps that reduce the probability of insolvency exist on Aave V3, they are absent on V2 the set aside a alternative of users quiet operate.

One other proposal from Aave developer Pauljlei addressed some of V2’s present dangers and proposed obvious fixes. This proposal called for making parameter adjustments on Aave V2 ETH and “rapid freezing” some markets.

Pauljlei named 17 tokens, along with YFI, CRV, ENJ, MANA and MKR, as volatile sources that must be frozen.

“Aave V2 lacks tons of the probability controls that Aave V3 solves for (present caps, borrow caps, isolation mode, e-mode, etc). Out of an abundance of warning and given the community’s most fresh decrease risk tolerance, we recommend rapid freezing the sources outlined above so as to derisk Aave V2 and promote eventual migration to V3,” he stated.