Kelp DAO Disputes LayerZero's Claims Over $290 Million Exploit, Citing Default Settings as the Cause

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 was responsible for the disaster due to its use of a single-verifier setup. According to a source familiar with the matter, Kelp plans to argue that the compromised verifier was actually part of LayerZero's own infrastructure, and that the setup it was using was the default configuration provided by LayerZero. 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 then used to flood the backup servers with junk traffic, forcing LayerZero's verifier onto the compromised ones. The source also contested LayerZero's framing of the '1/1 configuration' as a fringe choice made against guidance, pointing out that LayerZero's own quickstart guide and default GitHub configuration recommend a 1/1 DVN setup, which is also 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. Kelp DAO has confirmed that it will work with LayerZero to establish a shared and accurate account of what happened and to make the necessary fixes.