Traders Doubt Kelp Will Share $292 Million Exploit Losses

According to a Polymarket contract, it's unlikely that Kelp DAO will spread the losses from the recent $292 million exploit to unaffected users. Bettors give a 14% chance of Kelp implementing a mechanism to 'socialize the losses,' which would force rsETH holders on Ethereum to share the financial burden with users on other chains. The attack drained approximately 116,500 rsETH from a LayerZero-powered bridge, resulting in parts of the system becoming undercollateralized. 'Socializing the losses' would involve Kelp redistributing the shortfall across all rsETH holders, including those on the Ethereum mainnet. This approach has been used in the past, such as when Bitfinex imposed losses on all users after a $60 million hack in 2016. However, Kelp's situation is more complex, with losses fragmented across different user groups and platforms, making a system-wide redistribution both technically and politically challenging.