Summary
The week's defining story was the coordinated industry response to the $292 million KelpDAO bridge exploit from April 18. Aave organized the DeFi United initiative and secured more than $300 million in pledged contributions from Consensys, Lido, EtherFi, and others to cover bad debt generated when stolen rsETH was used as collateral across lending markets. DeFi's total TVL fell from $99.5 billion to $86.3 billion in under 48 hours, the sharpest two-day decline since LUNA.
The rest of the stack kept moving. Aave launched natively on Solana through the Sunrise bridge on April 27. Morpho crossed $11 billion in deposits and shipped two new integrations. Spark absorbed over $1 billion in net deposits from users rotating out of protocols with rsETH exposure. Let’s dive into these updates and more below.
Stablecoin Developments
Circle (USDC): USDC utilization on Aave's Ethereum Core market approached 100% mid-week as KelpDAO-driven withdrawals reduced available liquidity to under $3 million. Circle's chief economist Gordon Liao submitted a governance proposal to raise USDC borrowing rates on the market to attract new deposits and restore supply. Current USDC yields include 3.3% APY on Aave Ethereum, 4.3% APY on STEAKUSDC Morpho, and 4.2% APY on Jupiter Lend.
Tether (USDT): USDT remains the largest stablecoin by total value locked. Maple is currently one of the most active venues for USDT yield with over $1B in TVL earning 4.5% APY, while USDT on Aave Ethereum earns 4.1% and leading Morpho vaults range between 3% and 5% APY.
Sky Money (USDS): Sky submitted a Treasury Overhaul Proposal on April 27 that would cap capital expenditures as a fixed percentage of protocol revenue, shifting toward predictable budget governance. The USDS supply stands at $8.4 billion, placing Sky third globally among stablecoin issuers. Savings USDS (sUSDS) currently earns 3.65% APY with $5.5B in TVL, while staked USDS (stUSDS) earns 4.9% APY.
Protocol Developments
Aave: Aave launched natively on Solana on April 27 through Sunrise, with AAVE immediately available across Solana DEXs. The Solana Foundation provided a USDT loan to seed liquidity at launch, the first time the Foundation deployed treasury funds outside the Ethereum ecosystem.
Lido: Lido submitted a governance proposal to allocate up to 2,500 stETH, approximately $5.8 million, toward the KelpDAO recovery shortfall as one of several contributors in the DeFi United coalition. Separately, the Lido Ecosystem Operations team proposed a one-off buyback of up to 10,000 stETH (approximately $20 million) from the DAO treasury to purchase LDO. stETH currently yields 2.6% APY with $21B in TVL.
Morpho: Morpho crossed $11 billion in deposits this week, a first for the protocol and a recovery from a 9.62% drawdown in the days immediately following the KelpDAO exploit. Two integrations shipped before month end: Symbiotic and Midas launched a tokenized RWA settlement layer on Morpho's infrastructure on April 28, and Altura opened an AVLT lending market using vault shares as collateral on April 29.
Spark: Spark received more than $1 billion in net deposits this week after it became widely known the protocol had removed rsETH from its approved collateral set before the exploit occurred. The inflow reflects a direct rotation from protocols with rsETH exposure into those perceived to have tighter collateral controls.
Hyperliquid: Hyperliquid's 30-day perpetuals volume exceeded $180 billion, with the protocol holding more than 70% market share among decentralized perp exchanges. HYPE reached a $10.4 billion market cap on April 27, landing among CoinGecko's trending assets for the week.
Pendle: Pendle launched pools for eACRED, eEARN, and mTBILL maturing mid-2026, extending its onchain yield trading coverage for tokenized real-world assets. The tokenized STRC pool crossed $100 million in trading volume. Protocol TVL sits at $1.415 billion with $34 million in annualized revenue.
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The theme this week is collateral visibility: which protocols had rsETH exposure, which removed it before the crisis, where USDC liquidity sat at near-zero utilization. Platforms that can answer those questions in real time give users a real edge during episodes like this one, and the protocols that got the collateral call right captured ten-figures in new deposits.
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