Bitcoin Surges Above $76,000 Amid $14 Billion DeFi Exodus Following KelpDAO Security Breach

On Monday, the price of Bitcoin (BTC) $77,718.58 maintained its position above $76,000, recovering from its overnight lows as the broader cryptocurrency market demonstrated resilience in the face of rising Iran-related tensions. Over the past 24 hours, the largest cryptocurrency experienced a 2.4% increase, bouncing back from a dip below $74,000 earlier in the session. This move was mirrored by other major altcoins, including Ether (ETH), XRP, and Solana (SOL), as the broad-market CoinDesk 20 rose by 1.7%. This stability occurs against a backdrop of macroeconomic uncertainty. On Sunday, U.S. President Donald Trump announced that American forces had seized an Iranian-flagged cargo ship, warning of potential further escalation if Tehran refuses to negotiate a deal. A fragile ceasefire is set to expire later this week. 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%. The performance of cryptocurrency-related equities was mixed, with Coinbase (COIN) and bitcoin treasury firm Strategy (MSTR) gaining roughly 2%, while Circle (CRCL) and ether treasury Bitmine (BMNR) 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 some genuine demand," pointing to recent spot ETF inflows as a supporting factor. Unlike earlier rallies this year, he noted that the current move appears less driven by leverage. However, the path forward remains closely tied to geopolitical developments. A renewed ceasefire could potentially push bitcoin back toward $80,000, while further escalation may keep markets under pressure. For now, capital continues to concentrate in large-cap assets like bitcoin, De Maere observed, with riskier altcoins lagging, a pattern typical of market environments driven by macro headlines. DeFi Sector Reels from $292 Million KelpDAO Hack In other developments, the DeFi sector is still reeling from the largest crypto exploit of the year. The $292 million KelpDAO hack had a cascading effect across the market, as a vulnerability allowed the attacker to drain funds that were then used as collateral across lending protocols. Because those assets were widely integrated into DeFi, the impact quickly spread, with users rushing to withdraw funds amid fears of bad debt and contagion. According to DefiLlama data, the total value locked (TVL) across DeFi protocols fell by $14 billion over the past two days, even as asset prices remained steady. DeFi TVL dropped to about $85 billion, its lowest level in a year and roughly 50% below October peaks. Aave, the largest lending protocol that was central in the exploit, saw around $10 billion in deposits withdrawn. "There’s a tremendous risk-reward imbalance in DeFi," said David Shuttleworth from Anchorage Digital's protocol team. "Users will no longer accept the slightly higher (and sometimes lower) than risk-free rate they get by depositing in lending pools," especially given the latest wave of exploits across protocols.