On October 29 at approximately 9 pm UTC, attackers exploited Binance hot wallets on Ethereum, withdrawing 63 ERC-20 tokens and 167,464 ETH in a single transaction. A second transaction from another Binance Ethereum hot wallet sent an additional 28,006 ETH to the exploiter, along with funds from wallets on Arbitrum, Optimism, and Avalanche networks.
Aave responded by freezing its v3 and v4 markets across all networks, preventing both the exploiter and legitimate users from opening new supply or borrow positions. This action halted potential further damage but also created immediate downward pressure on the Aave token.
Market Impact
The broader cryptocurrency market reacted negatively to the incident. Bitcoin declined 3.46% and Ethereum fell 3.93% over the past 24 hours, while Aave fell 5.67%. The breach triggered significant liquidations across crypto markets, with over $1.50 billion in positions closed, predominantly long liquidations.
Aave Price Action and Technical Levels
Aave rallied 214.2% between June and September, climbing from $60 to $188. Since reaching that peak, the token has retraced 32.9% to $125.8. Technical analysis indicates the token has breached the $140 support zone, with the $115 bullish order block currently being tested.
Key technical levels to monitor include the fair value gap at the 78.6% Fibonacci retracement level near $129 and the $113.4 weekly support level. Analysts note that provided the weekly session does not close below $113.4, potential recovery could extend toward $213-$240.
Trading Outlook
The daily timeframe shows firmly bearish technical indicators, though the swing structure remains marginally bullish. Traders are advised to exercise caution given the combination of negative market sentiment and the ongoing technical weakness. Swing traders may consider entry points only after clearer signs of demand emerge, such as a move back above $120.
