An Aave user exchanged 50 million USDT for 327 AAVE, a mistake that cost them tens of millions of dollars. How is this possible, and what happened?
An Aave user makes the trade of a lifetime
Twenty days ago, the user received $50.4 million in USDT from Binance. Yesterday, he tried to exchange this USDT for AAVE, but the transaction clearly didn’t go as planned. He attempted to send the $50 million using Cow Protocol on Sushiswap. The problem: the liquidity in the Sushiswap pool was severely insufficient relative to the size of the order.
The price of AAVE therefore skyrocketed automatically… Which led the man to buy his AAVE at $154,000 each. The $50.4 million turned into $36,000.
Martin Grabina, an engineer at Aave, explained the mechanisms at play that led to this loss:
In this case, the user sent a market order with a suggested slippage of 1.21%. But the real problem wasn’t the slippage; it was simply the accepted quote with a price impact of 99%.
In other words, the user was warned of the estimated significant amount but confirmed the transaction anyway. A point highlighted by Stani Kulechov, Aave’s CEO:
Given the unusually large size of the single order, the Aave interface, like most trading interfaces, warned the user of extraordinary slippage and required confirmation via a checkbox. […] The transaction could not proceed without the user explicitly accepting the risk via the confirmation checkbox.
Several players in the crypto ecosystem are nevertheless surprised that Aave allowed such an action, including 0xngmi, founder of DefiLlama: “If you try to make this swap on Llamaswap, the user interface will completely prevent you from doing so; the buttons will be disabled.”
someone just swapped $50m for $36k on cowswap through aave’s frontend, effectively losing 50m
if you try to make this swap on llamaswap the UI won’t let you at all, buttons get lockedwe’ve spent years building a price API with the highest coverage of defi tokens to avoid this pic.twitter.com/CkjvsVEHec
— 0xngmi (@0xngmi) March 12, 2026
A MEV bot takes advantage
However, this error made one person happy. A MEV bot, built to monitor upcoming transactions, detected the upcoming transaction and instantly borrowed $29 million on Morpho, where the price of AAVE was at its “normal” level. It then dumped the Aave into the Sushiswap pool, repaid the loan, and pocketed $9.9 million for its work.
As for the user who lost tens of millions of dollars, they are left with nothing. Stani Kulechov, however, stated that the Aave teams would attempt to contact them:
We sympathize with the user and will try to contact them and return $600K in fees collected during the transaction.
This gesture remains largely symbolic, however: the amount represents 1.2% of the total loss.
Although the Aave team attributes the incident to a user error, some commentators see it as a way to launder money. Others believe the user may have operated the MEV bot themselves:
A compromised wallet where someone gained access to the keys and intentionally routed the funds through a catastrophic swap, knowing that their MEV bot would extract value on the other side.
Of course, all of this is just speculation. And as Stani Kulechov points out, the nature of DeFi is that it places the responsibility for transactions in the hands of users… For better or for worse.
