Bitcoin redemption freeze puts $136 million Aave market under scrutiny

Aave has restricted new deposits and borrowing against $136 million in tokenized Bitcoin after Threshold Network suspended tBTC minting and redemptions. The Oct. 31 intervention followed Threshold's decision to halt operations on its Bitcoin bridge while conducting undisclosed security maintenance, prompting decentralized lending protocols to limit their exposure to the asset. In an Oct. 31 security update , Threshold said the token remained fully backed, with approximately 4,320 BTC held in bridge wallets against 4,185 tBTC in circulation. “tBTC remains fully backed, and no funds have been lost,” the project stated, adding that investigators had found no unauthorized token minting. The reserves exceed the circulating supply by about 135 BTC, reassuring holders about the assets backing the token even as they temporarily lose access to direct Bitcoin redemptions.

BeCrypto News shows a short excerpt and links to the publisher. The full report belongs to CryptoSlate.