Hacker Drains $292 Million from Kelp DAO, Disrupting DeFi with Massive Crypto Heist

A recent and severe security breach has compromised a cross-chain bridge operated by Kelp DAO, a liquid restaking protocol, resulting in the loss of nearly 18% of the circulating supply of restaked ether tokens. The attacker successfully exploited the bridge's cross-chain messaging layer, managed by LayerZero, to transfer 116,500 rsETH tokens to an attacker-controlled address, valued at roughly $292 million. The incident has triggered a series of emergency measures, including the freezing of core contracts and the suspension of rsETH markets on various platforms such as Aave, SparkLend, and Fluid. As the DeFi community grapples with the fallout, concerns are growing about the potential for a broader contagion effect, with many protocols and investors exposed to the compromised token. Kelp DAO has initiated an investigation into the incident, collaborating with LayerZero, Unichain, and external security experts to determine the cause of the breach and potentially recover the stolen funds.