Massive Crypto Heist: Kelp DAO Loses $292 Million in Cross-Chain Exploit

A devastating cross-chain bridge hack has shaken the DeFi ecosystem, with nearly 18% of the circulating supply of restaked ether tokens being drained from Kelp DAO's LayerZero-powered bridge. The attack, which occurred on Saturday at 17:35 UTC, saw 116,500 rsETH, worth around $292 million, being siphoned off to an attacker-controlled address. The breach has triggered a wave of emergency measures, including freezes on Aave, SparkLend, and Fluid, as well as a pause on Lido Finance's earnETH product. The Kelp DAO protocol, which operates under the KernelDAO umbrella, has acknowledged the incident and is working with LayerZero, Unichain, auditors, and security specialists to investigate the matter. The hack has significant implications for the DeFi space, with potential repercussions for holders of wrapped rsETH tokens across over 20 networks, including Base, Arbitrum, and Scroll. As the situation unfolds, market participants are bracing for potential contagion, with AAVE prices already experiencing a 10% drop. The incident marks the largest DeFi exploit of 2026, surpassing the recent Solana-based Drift protocol hack.