The DeFi Circuit Breaker That Could Have Stopped The rsETH Exploit, And Why Linea Implemented It

Odysseus is the Founder and CEO of Phylax Systems, and Declan Fox is the VP and Head of Linea at Consensys.The rsETH exploit drained $292M from Aave, but a simple rule or circuit breaker could have prevented bigger losses!In this episode, Odysseus and Declan walk us through how Phylax's DeFi circuit breaker works: code currently running on the Linea sequencer that checks every transaction against a set of protocol-defined policies before it's added to a block. Already live on Linea, Phylax has stopped over 4,000 drain attempts and protected $1.5M in cumulative volume, including a real attack on 0x where users were being drained through an immutable contract. They also cover what institutions are still waiting for before coming onchain, and how banks can build secure, private composable environments powered by Ethereum.------💎 THIS EPISODE'S SPONSORS🔒 KPK | Best risk-adjusted yield through automated vaults🕛 NOON | The highest and safest stablecoin yield, built for the long term👻 MANTLE | Aave V3 is live on Mantle🐡 PUFFER INSTITUTIONAL | ETH staking solutions for scale⚔️ KATANA | Deep liquidity & real yield------⏱️ TIMESTAMPS0:00 - Intro2:02 - Declan’s work as Head of Linea3:15 - What Is Phylax? Preventative security for blockchains and apps4:45 - Ethereum’s security, with privacy and more protective controls for users12:14 - How Phylax can protect L2s and apps without sacrificing decentralization14:33 - What are institutions still waiting for, in order to come onchain?18:54 - How Linea is helping institutions come onchain23:06 - Freezing assets vs programmatic rules: what's the right threshold for action?26:09 - Why institutional demand for DeFi should help crypto transcend politics32:54 - How a Phylax circuit breaker could have stopped the Aave rsETH exploit38:09 - What actually triggers the Phylax circuit breaker to detect and stop an attack?42:38 - TradFi can build private, composable walled gardens on Ethereum45:56 - How dApp and networks can get started implementing Phylax47:32 - Closing------🔗 GUEST LINKS► Phylax website: https://phylax.systems/► Phylax Systems on X: https://x.com/phylaxsystems► Odysseus on X: https://x.com/odysseas_eth► Linea website: https://linea.build/► Linea on X: https://x.com/lineabuild► Declan Fox on X: https://x.com/DeclanFox14------🎙️ MORE FROM THE EDGE PODCAST AND EDGE NEWSLETTER► Newsletter: https://the-edge.xyz► Apple: https://tinyurl.com/edgepod► Spotify: https://tinyurl.com/edgepodspotify► Linktree: https://linktr.ee/edge_pod► Follow DeFi Dad: https://x.com/DeFi_Dad► Follow Nomatic: https://x.com/Nomaticcap► Learn DeFi: http://defidad.com/------DISCLAIMER: Nothing said on The Edge Podcast is a recommendation to buy or sell tokens or securities. This content is for educational and entertainment purposes only. Nothing shared here is financial advice. Any views expressed by hosts or guests on the show are solely their opinions. Always do your own research. DeFi Dad, Nomatic, and guests may have positions in the assets or other matters discussed in this podcast.