Kelp DAO Disputes LayerZero's Claims Over $290 Million Incident

A recent incident involving a $290 million exploit has sparked a dispute between Kelp DAO and LayerZero. Kelp DAO is pushing back against LayerZero's claims that the incident was caused by Kelp's use of a single-verifier setup, which LayerZero had advised against. Instead, Kelp DAO argues 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 about $290 million, from Kelp's LayerZero-powered bridge by poisoning the servers that LayerZero's verifier relied on to check transactions. Kelp DAO claims that the infrastructure was built and run by LayerZero, not Kelp, and that the configuration used was based on LayerZero's quickstart guide and default GitHub configuration. Security researchers have also questioned LayerZero's claims, with one researcher noting that LayerZero's reference setup ships with single-source verification defaults across every major chain. The incident has led to a protocol-wide migration, with LayerZero announcing that it will no longer sign messages for any application running a single-verifier setup. 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.