Mantle Proposes 30K $ETH Loan to Aave After $292M Kelp Exploit

Ethereum News

Bybit-backed Ethereum layer-2 network Mantle has published a governance proposal to lend up to 30,000 $ETH to Aave DAO to help the protocol absorb bad debt stemming from last week’s $292 million Kelp DAO exploit.

The Mantle Core Contributor Team published the proposal, designated MIP-34, on Thursday, outlining a strategic credit facility for Aave DAO directed exclusively at resolving the rsETH bad debt on Aave V3. Mantle Treasury would receive a yield on the loan, with proceeds from loan interest directed to the treasury for $MNT token burns or ecosystem funding. The proposal said the arrangement "demonstrates active treasury management and a proactive stance on industry resilience, reinforcing token holder confidence in Mantle's long-term stewardship."

The proposal outlines an indicative interest rate of the Lido staking annual percentage rate plus a 1% premium, subject to final negotiation, with a maturity of up to 36 months and no early repayment penalty. As collateral, Aave would need to deposit Aave tokens worth at least $11 million and direct 5% of its revenue to a multisig wallet under Mantle's first-priority lien. In the event of a default, the loan would become immediately due and payable.