Decentralized finance (DeFi) protocol Aave has seen a sharp decline in activity, with its total value locked (TVL) falling 33% over the past week to roughly $16.7 billion, according to DeFiLlama data. 

The data shows that Aave’s TVL dropped from $34 billion in January. The protocol’s on-chain revenue also dropped from $1.1 million in early February to $625,000 on Monday.

The drop comes despite a broader recovery across crypto assets, with major tokens posting gains amid improving macro and geopolitical sentiment.

Kelp DAO incident triggers risk-off shift across DeFi

The decline is partly traced to last week’s $293 million exploit involving Kelp DAO’s rsETH token. Attackers exploited a vulnerability in a LayerZero V2 bridge between Unichain…