Kelp DAO Disputes LayerZero's Account of $290 Million Disaster, Citing Default Settings as Culprit

A recent crypto incident has sparked a heated debate, with Kelp DAO set to challenge LayerZero's post-mortem analysis of the $290 million exploit that occurred on Sunday. According to a source familiar with the matter, Kelp DAO plans to argue that the compromised verifier was actually part of LayerZero's own infrastructure, and that the setup it used was based on LayerZero's default configuration. This configuration, which has been criticized for being a single-verifier setup, is allegedly used by 40% of protocols on LayerZero. The incident has raised questions about the security of cross-chain messaging infrastructures and the responsibility of protocols in ensuring the safety of user funds. Kelp DAO, a liquid restaking protocol, has stated that it relied on LayerZero's documentation and guidance when configuring its setup, and that it had maintained close communication with the LayerZero team. The incident has also sparked a wider debate about the security of the crypto industry, with some commentators arguing that it exposes contagion risk and undermines trust in the sector. As the situation continues to unfold, both Kelp DAO and LayerZero have released statements, with Kelp DAO calling for a shared and accurate account of what happened, and LayerZero announcing plans to harden security across every possible vector for applications.