The incident report released by Aave shows that the Kelp DAO cross-chain bridge vulnerability led to approximately $190 million in loans being unsecured, putting Aave at potential bad debt risk. The report from Aave Labs and LlamaRisk states that the attacker forged cross-chain messages to release 116.5k rsETH from the Ethereum side bridge, then deposited 89.6k rsETH as collateral into Aave, borrowing about $190 million worth of ETH and related assets. Aave froze the rsETH market within hours and set the loan-to-value ratio to zero. The final loss depends on how Kelp DAO handles the shortfall: if the loss is shared among all rsETH holders, rsETH is expected to depeg by about 15%, resulting in approximately $123 million in bad debt for Aave; if the loss is concentrated on Layer 2 networks, bad debt could rise to about $230 million, mainly on networks like Arbitrum and Mantle. After the incident, Aave's total locked assets withdrew about $6 billion. The Aave DAO treasury holds approximately $181 million in assets and is discussing ways to cover potential losses with ecosystem participants.