Kelp DAO Counters LayerZero's Claims, Alleging Default Settings Caused $290 Million Exploit

A recent crypto exploit has sparked a heated debate, with Kelp DAO set to challenge LayerZero's account of the $290 million disaster. According to a source familiar with the matter, Kelp plans to argue that the compromised verifier was part of LayerZero's own infrastructure, and the setup that was criticized was actually LayerZero's default configuration. The incident 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 DVN was part of LayerZero's infrastructure, not a third-party verifier, and that the setup was based on LayerZero's default configuration. 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 framing of the incident, 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 crypto industry.