Kelp DAO Disputes LayerZero's Claims Regarding $290 Million Disaster

A recent $290 million exploit has sparked a heated debate between Kelp DAO and LayerZero, with Kelp set to dispute LayerZero's claims that it ignored warnings about its single-verifier setup. 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 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 check transactions. Kelp claims that the attackers compromised two of LayerZero's own servers, which were used to verify cross-chain transactions, and then flooded the backup servers with junk traffic to force LayerZero's verifier onto the compromised ones. The source contested LayerZero's framing of the '1/1 configuration' as a fringe choice made against guidance, stating that LayerZero's own quickstart guide and default GitHub configuration point to a 1/1 DVN setup, which is used by 40% of protocols on LayerZero. Security researchers have also questioned LayerZero's isolated framing, which pinned the blame on Kelp, with some accusing LayerZero of 'deflecting responsibility' for its own compromised infrastructure. In response to the incident, LayerZero has announced that it will no longer sign messages for any application running a single-verifier setup, forcing a protocol-wide migration.