Kelp DAO Disputes LayerZero's Claims Over $290 Million Hack

A recent $290 million exploit has sparked a heated debate between Kelp DAO and LayerZero, with Kelp planning to dispute LayerZero's claims that it ignored warnings about its single-verifier setup. According to a source familiar with the matter, Kelp will argue that the compromised verifier was actually part of LayerZero's own infrastructure, and that the setup used was based on LayerZero's default settings. The incident has raised questions about the security of cross-chain messaging protocols and the responsibility of infrastructure providers. Kelp, a liquid restaking protocol, had used LayerZero's infrastructure to move its receipt token, rsETH, between blockchains. However, on Saturday, attackers drained 116,500 rsETH, worth about $290 million, from Kelp's LayerZero-powered bridge by poisoning the servers that LayerZero's verifier relied on to check transactions. Kelp claims that the attackers compromised two of LayerZero's own servers and then flooded the backup servers with junk traffic to force LayerZero's verifier onto the compromised ones. The source also contested LayerZero's framing of the '1/1 configuration' as a fringe choice made against guidance, pointing out that LayerZero's own quickstart guide and default GitHub configuration recommend a 1/1 DVN setup. Security researchers have also questioned LayerZero's isolated framing, which pinned the blame on Kelp, with some accusing LayerZero of deflecting responsibility for its own compromised infrastructure.