KelpDAO Developer Files Lawsuit Against LayerZero Over $292 Million Exploit
Evercrest Technologies, the developer behind KelpDAO, has initiated legal action against LayerZero and its CEO Bryan Pellegrino, following a significant exploit that resulted in a loss of $292 million. The lawsuit claims that vulnerabilities within LayerZero's infrastructure, specifically its rsETH bridge, were exploited, allowing attackers to mint tokens without the necessary deposits.
The complaint details that the exploit stemmed from a compromised developer device and manipulated RPC data, rather than any flaws in KelpDAO's contracts. On March 6, 2026, an attacker allegedly infiltrated a LayerZero developer's machine, subsequently targeting the RPC infrastructure of LayerZero's Decentralized Verifier Network (DVN) on April 18. This manipulation led to false confirmations that 116,500 rsETH had been locked on Unichain, despite no actual deposits occurring, resulting in the unauthorized minting of tokens on the Ethereum network.
Evercrest asserts that it acted swiftly to mitigate the damage by suspending its LayerZero bridges and freezing the attacker's wallet within an hour of identifying the exploit. The developer also disputes LayerZero's public narrative regarding the incident, claiming that the company had previously endorsed KelpDAO's bridge configuration and instructed its use of a single-verifier setup. Evercrest is seeking damages for negligent misrepresentation, negligent provision of services, and defamation, citing significant financial repercussions including over $650 million in user withdrawals and a decline in overall assets and revenue.
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Source: KLEA News