Bitcoin Surges Past $76,000 Amid DeFi's $14 Billion Exodus Following KelpDAO Hack

The price of Bitcoin held steady above $76,000 on Monday, with a 2.4% increase over the past 24 hours, recovering from a dip to below $74,000. This rebound was mirrored by other major cryptocurrencies such as Ether, XRP, and Solana, contributing to a 1.7% rise in the broad-market CoinDesk 20. The resilience of the crypto market comes amidst a volatile macroeconomic backdrop, with US President Donald Trump announcing the seizure of an Iranian-flagged cargo ship, warning of potential escalation. As a result, oil prices surged 6% to nearly $90, while the S&P 500 and Nasdaq experienced modest declines of around 0.3%-0.4%. Crypto equities saw mixed results, with Coinbase and Strategy gaining roughly 2%, while Circle and Bitmine edged lower by 1%-2%. According to Jasper De Maere, a trader at Wintermute, the fact that prices have not fully retraced despite new tensions suggests genuine demand, pointing to recent spot ETF inflows as a supporting factor. However, the path forward remains tied to geopolitical developments, with a renewed ceasefire potentially pushing Bitcoin toward $80,000, while further escalation may keep markets under pressure. For now, capital continues to concentrate in large-cap assets like Bitcoin, with riskier altcoins lagging, a pattern typical of market environments driven by macro headlines. In other news, the DeFi sector is reeling from the $292 million KelpDAO hack, the largest crypto exploit of the year. The hack cascaded across the market, as a vulnerability allowed the attacker to drain funds that were then used as collateral across lending protocols. As a result, users rushed to withdraw funds amid fears of bad debt and contagion, leading to a $14 billion decline in total value locked (TVL) across DeFi protocols over the past two days, according to DefiLlama data. The DeFi TVL dropped to approximately $85 billion, its lowest level in a year, roughly 50% below October peaks. Aave, the largest lending protocol central to the exploit, saw around $10 billion in deposits withdrawn. David Shuttleworth from Anchorage Digital's protocol team noted that there is a tremendous risk-reward imbalance in DeFi, with users no longer accepting the slightly higher, and sometimes lower, risk-free rates they get by depositing in lending pools, especially given the latest wave of exploits across protocols.