Aave Introduces Shield to Prevent Large Price Impact Swaps

Aave has launched a new feature called Aave Shield following a significant loss experienced by a user who swapped 50.4 million USDt for AAVE through CoW Swap. According to NS3.AI, the Shield aims to prevent swaps with a price impact exceeding 25% unless users choose to disable the protection manually. CoWDAO explained that the incident was due to thin liquidity and multiple infrastructure failures, which left only a suboptimal route available for the transaction. Consequently, an MEV bot executed a sandwich attack, profiting nearly $10 million from the swap.