Kelp DAO Completes rsETH Recovery After $293 Million Hack

Kelp DAO, a decentralized finance platform, has completed recovery work following a major hack in April.

Cointelegraph reported on May 26 that Kelp DAO announced on its official X account that it had transferred the final batch of 20,373.7 rsETH to a LayerZero smart contract. The contract is responsible for locking, minting, burning and withdrawing rsETH during cross-chain transfers.

The transfer marks the end of the operational phase of Kelp DAO's rsETH recovery plan.

Kelp DAO suffered losses of about $293 million in the April hack. North Korean hacking group Lazarus was identified as the suspected attacker.

The incident also sent shockwaves through the broader DeFi market. The hacker deposited 116,500 rsETH stolen in the attack as collateral on Ethereum-based lending platform Aave and borrowed wrapped Ether, or wETH. The process created about $190 million in bad debt. Aave later saw large-scale fund outflows.

On May 13, Kelp DAO moved the first recovery tranche of 25,000 rsETH, resuming bridging between the Ethereum mainnet and Layer 2 networks. It later restored rsETH withdrawals and said minting, redemption and rewards functions are now operating normally.

Aave's total value locked, however, has yet to recover. Data from DefiLlama show Aave's TVL fell from about $26.4 billion before the hack to about $14 billion to $15 billion and has since remained rangebound.