Key Highlights
- An Ethereum wallet swapped 50,432,688.41618 aEthUSDT for just 327.2413 aEthAAVE, according to Etherscan screenshots.
- The received amount was valued at roughly $36,297, versus more than $50.43 million sent in the trade.
- YAM said the swap was likely executed through Aave’s UI collateral swap feature and blamed poor routing across aggregators.
A wallet on Ethereum appears to have suffered an enormous loss after a swap involving more than $50.43 million worth of tokenized USDT collateral executed at an extremely unfavorable rate.
According to the transaction details visible on Etherscan, wallet 0x98B9D979…1FBF97Ac8 swapped 50,432,688.41618 aEthUSDT for only 327.241335505966487788 aEthAAVE on CoW Protocol. The received amount was shown as being worth about $36,297.60, compared with the input value of $50,432,688.41.
The transaction, carrying hash 0x9fa9feab3c…..2ce430801f, was marked successful on Ethereum and confirmed within 30 seconds.
Aave UI collateral swap suspected
DeFi commentator YAM said in a post on X that the trade was “very likely” executed through Aave’s UI using its collateral swap function. The reasoning, according to the post, is that the assets involved were aEthUSDT and aEthAAVE, which represent deposit positions inside the Aave protocol rather than standard spot tokens.
That suggests the user may not have been making a normal market buy of AAVE, but instead attempting to swap one Aave collateral position for another. In this case, however, the execution appears to have delivered a catastrophic outcome.
YAM added that the issue was “mostly bad routing done by most aggregators,” while also saying it did not appear that CoW Swap misrepresented the price of aEthAAVE.
Routing questions return to the spotlight
The incident is likely to renew scrutiny around how aggregators and protocol interfaces handle very large, thinly liquid, or wrapped collateral tokens. While major spot pairs may show deep liquidity, specialized assets such as Aave interest-bearing tokens can behave very differently, especially when routed through multiple aggregators or simulated against limited on-chain markets.
The screenshots shared by YAM also referenced Matcha and CoW Swap, claiming that aggregators broadly struggled with pricing or routing this pair properly.
At face value, the trade implies that more than $50 million in tokenized USDT collateral was exchanged for an output worth less than $40,000, making it one of the most severe apparent execution failures seen in a DeFi collateral swap this year.
No official statement yet
At the time of writing, there was no statement visible in the provided material from Aave, CoW Protocol, or the wallet owner explaining whether the trade resulted from user error, interface design, routing failure, or an edge case involving Aave deposit tokens.
The transaction is already drawing attention across DeFi circles because it highlights a recurring structural risk in on-chain trading: even when a transaction succeeds on-chain, execution can still be economically disastrous if liquidity, token wrappers, or routing logic are misunderstood.
This incident comes just a day after Aave faced a separate oracle-related issue that caused about $26 million in wrongful liquidations across 34 accounts. That glitch stemmed from a CAPO pricing mismatch on wstETH, briefly pushing healthy positions into liquidation before Aave moved to reimburse users, underscoring broader concerns around risk tooling and execution across DeFi.
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