Kelp DAO said it has permanently burned 117,132 rsETH tied to the hacker on Arbitrum, putting a key part of its post-attack recovery plan into motion. The protocol said the burn was meant to remove the attacker’s footprint from the ecosystem and help rebuild confidence after the April incident.
To replace the burned amount, a multisignature wallet overseen by the Aave Recovery Guardian and Kelp’s internal security wallet will jointly transfer a total of 117,132 rsETH. Those transfers will be executed through smart contracts and are expected to finish in about two weeks.
$293 million exploit traced to bridge adapter weakness
The move follows the major cyberattack Kelp suffered in April. According to the project, the exploit was attributed to the North Korea-linked Lazarus Group, and a vulnerability in the rsETH adapter bridge contract enabled the illicit withdrawal of $293 million from the system.
OpenZeppelin later reported that it did not find critical smart contract flaws, but it did point to basic operational weaknesses in the protocol’s processes. Kelp then introduced a new set of security controls. Bridge transactions now require approval from four independent parties and confirmation across 64 blocks, while some layer-2 transfers remain temporarily suspended.
Withdrawals to reopen 24 hours after first transfer
Kelp also said it is preparing to move its bridge infrastructure to Chainlink’s cross-chain protocol. For users waiting on access to funds, the protocol gave a more specific timeline: withdrawal services will be restored within 24 hours of the first smart contract transfer. After the full process is completed, deposit, withdrawal, bridging, and redemption functions for rsETH are set to resume normal operation.
The team added that rsETH in circulation across Ethereum mainnet and all layer-2 networks still carries a market value of about $1.5 billion and remains fully backed by collateral.
Total value locked falls to $1.55 billion
Data from DeFiLlama shows Kelp’s total value locked now stands at $1.55 billion. That figure had climbed above $2 billion in September 2025 before declining after the hack and the security concerns that followed. Kelp runs on Ethereum with EigenLayer infrastructure and is known for offering extra yield tied to ETH and other liquid staking tokens, while maintaining deep liquidity in DeFi markets.
On the market side, data cited by Cointelegraph indicated that Ethereum derivatives investors have not turned notably pessimistic. Spot Ether, though, fell to $2,260, its lowest level in the last 12 days.