Kelp DAO Disputes LayerZero's Account of $290 Million Exploit, Citing Default Settings as Primary Cause

A recent $290 million exploit has sparked a heated debate between Kelp DAO and LayerZero, with Kelp set to challenge LayerZero's post-mortem analysis. According to a source familiar with the matter, Kelp plans to argue that the compromised verifier was part of LayerZero's own infrastructure, and that the setup was based on LayerZero's default configuration. The exploit occurred when attackers drained 116,500 rsETH, worth approximately $290 million, from Kelp's LayerZero-powered bridge by poisoning the servers that LayerZero's verifier relied on to verify transactions. Kelp claims that the compromised verifier was not a third-party entity, but rather LayerZero's own infrastructure. The source also contested LayerZero's claim that Kelp chose a 1-of-1 DVN setup despite recommendations to configure multi-DVN redundancy, stating that LayerZero's own quickstart guide and default GitHub configuration point to a 1/1 DVN setup. Security researchers have also questioned LayerZero's account, with one researcher noting that LayerZero's reference setup ships with single-source verification defaults across every major chain. The incident has sparked a wider debate about the security of cross-chain messaging infrastructure and the need for greater transparency and accountability in the industry.