Major Crypto Heist: Kelp DAO Loses $292 Million to Exploit, Leaving 20 Blockchains Exposed

A recent security breach has left a significant portion of the circulating supply of restaked ether tokens at risk, after an attacker successfully drained nearly 18% of the total supply from Kelp DAO's LayerZero-powered bridge. The incident, which occurred on Saturday at 17:35 UTC, saw the attacker make off with 116,500 rsETH, worth around $292 million at current prices. This staggering loss has triggered a series of emergency measures across various DeFi platforms, including Aave, SparkLend, and Fluid, which have all frozen their rsETH markets in response to the attack. The breach has also led to a significant decline in the value of AAVE, with the token falling by around 10% as the market reacts to the potential bad debt. Lido Finance has paused further deposits into its earnETH product, which is exposed to rsETH, while Ethena has temporarily halted its LayerZero OFT bridges from Ethereum mainnet as a precautionary measure. The fallout from this incident is still unfolding, with the potential for further contagion and instability across the DeFi ecosystem. Kelp DAO has acknowledged the incident and is currently investigating the attack with the help of LayerZero, Unichain, and outside security specialists. The incident highlights the ongoing risks and challenges faced by the DeFi sector, which has experienced a string of high-profile exploits in recent weeks, including the $285 million heist from Solana-based perpetuals protocol Drift on April 1.