KelpDAO developer Evercrest sues LayerZero and CEO over $292 million bridge exploit

Sources · 6 sources

1. CB

   Coin Bureau@coinbureauPost on X · Sep 25

   🚨BREAKING: KelpDAO sues LayerZero and its CEO over the $292 MILLION rsETH bridge exploit. KelpDAO alleges undisclosed risks and a 1-of-1 verifier setup enabled North Korea-linked hackers to drain 116,500 rsETH. The dispute centers on whether LayerZero endorsed the single-verifier configuration that KelpDAO says left the bridge exposed. LayerZero CEO Pellegrino calls the claims “meritless” and vows to fight them in Vancouver courts. KelpDAO says it is migrating to a safer bridge to protect users. The battle over responsibility for the $292 million exploit is now heading to court.

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2. LS

   Laura Shin@laurashinPost on X · Sep 25

   Evercrest, the developer of Kelp DAO, has sued LayerZero and CEO Bryan Pellegrino in British Columbia over April's $292 million rsETH bridge exploit, alleging negligent misrepresentation, negligence and defamation. https://t.co/fjnu2pofyc

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3. CP

   Crypto Patel@CryptoPatelPost on X · Sep 25

   KELPDAO SUES LAYERZERO: $292M rsETH HACK HEADS TO COURT The biggest DeFi exploit of 2026 is now the biggest DeFi lawsuit of 2026. WHAT HAPPENED: On September 24, 2026, KelpDAO filed a civil claim in British Columbia, Canada, against LayerZero Labs and its CEO Bryan Pellegrino, who is named personally. @KelpDAO filed through its legal entity, Evercrest Technologies Inc. The case concerns the April 18 exploit that drained 116,500 $rsETH, worth about $292M at the time. The attack is attributed to North Korea's Lazarus Group. KELPDAO'S CLAIMS: 🔹 LayerZero failed to disclose risks in its own technology 🔹 LayerZero failed to stop attackers from infiltrating its security infrastructure 🔹 LayerZero "reviewed and endorsed, in writing" Kelp's bridge setup 🔹 Kelp says it wants its "day in court," so no quick settlement is expected LAYERZERO'S DEFENSE: ❌ Pellegrino calls the claim "meritless" and says he will fight it in Vancouver ❌ LayerZero blames Kelp's single-verifier (1-of-1 DVN) setup About 47% of roughly 2,665 LayerZero apps ran the same 1-of-1 setup at the time of the hack. If nearly half the ecosystem used it, was this one team's mistake or an industry-wide flaw? LayerZero banned 1-of-1 setups only after the hack. Kelp has since moved rsETH to Chainlink CCIP. This case could set the first legal benchmark for who pays when DeFi infrastructure fails. Always check how many verifiers secure the bridges you use. One weak checkpoint can cost millions. Full complaint: https://t.co/mCldHLuHRr Who's right: Kelp or LayerZero? 👇

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4. TB

   The BlockArticle · Sep 25

   KelpDAO sues LayerZero, claims it endorsed setup used in $292 million rsETH exploit KelpDAO sued LayerZero and Bryan Pellegrino over the April 18 rsETH exploit, alleging the bridge setup was endorsed in writing.

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5. WB

   Wu Blockchain@WuBlockchainPost on X · Sep 25

   Evercrest (KelpDAO) Files Civil Claim Against LayerZero and CEO Bryan Pellegrino in Canada LayerZero co-founder and CEO Bryan Pellegrino said Evercrest (KelpDAO) filed a notice of civil claim in British Columbia against LayerZero and Pellegrino personally. He called the claims meritless and said he would defend the case in Vancouver. KelpDAO said the lawsuit concerns the rsETH bridge exploit earlier this year. The complaint alleges that LayerZero failed to disclose risks in its technology or prevent its security infrastructure from being compromised, despite having reviewed and approved KelpDAO’s deployment and configuration in writing. In April 2026, KelpDAO’s rsETH bridge, built on LayerZero, was exploited, resulting in the theft of approximately 116,500 rsETH, then worth about $292 million. The two sides subsequently disputed responsibility for the incident.

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6. UN

   UnchainedArticle · Sep 25

   Kelp DAO Sues LayerZero and CEO Bryan Pellegrino Over $292 Million rsETH Bridge Exploit Evercrest Technologies , the company that develops liquid restaking protocol Kelp DAO , has sued LayerZero Labs and its co-founder and CEO Bryan Pellegrino in the Supreme Court of British Columbia over the April exploit of rsETH’s LayerZero bridge. The notice of civil claim is dated Sept. 24, and Kelp published it late Thursday. In its statement, Kelp said “the exploit was a direct result of LayerZero’s failures” and that LayerZero had “reviewed and endorsed” its deployment in writing. The April 18 attack released 116,500 rsETH , worth about $292 million at the time, that was not backed by any deposits. LayerZero later linked the attack to North Korea’s Lazarus Group. The claim alleges negligent misrepresentation, negligence and defamation and seeks damages, including aggravated and punitive damages on the defamation claim. It names no figure, but says the exploit and LayerZero’s public statements have inflicted “tens of millions of dollars of damages” on Evercrest. What Kelp Alleges The case turns on how the bridge was verified. LayerZero relies on Decentralized Verifier Networks, or DVNs, to confirm that tokens were locked or burned on one chain before matching tokens are minted on another. The Unichain bridge hit in April needed approval from just one DVN, run by LayerZero. Evercrest says LayerZero backed that 1-of-1 setup in written messages in February 2024, March 2024 and January 2025, at one point telling it to copy the configuration of another single-verifier bridge. It also alleges LayerZero warned another developer, USDT0, about risks in its default configurations but never warned Kelp. LayerZero’s April 19 statement said it and others “previously communicated best practices around DVN diversification to KelpDAO.” According to the filing, the breach started on March 6, when an attacker used social engineering to install malware on a LayerZero developer’s computer. The attacker then tampered with LayerZero’s RPC nodes and hit an outside RPC provider with a denial-of-service attack, so LayerZero’s DVN approved a forged message. The Defamation Claim Pellegrino is sued personally over posts on X and Telegram. The claim also targets that April 19 statement , in which LayerZero said on its blog that Kelp’s setup “directly contradicts the multi-DVN redundancy model that LayerZero has consistently recommended to all integration partners.” Evercrest says users have pulled more than $650 million from Kelp since the exploit, at current ETH prices, and that it put up 2,000 ETH to help restore rsETH’s backing. LayerZero’s Response “The claim continues to be meritless, will meet them in Vancouver and defend myself accordingly,” Pellegrino wrote on X on Thursday. LayerZero has maintained that Kelp first used multi-verifier defaults and moved to a single verifier on its own, a point the filing disputes. LayerZero’s May incident report said its DVN “will refuse to sign as the sole required attestor on any channel.” Kelp said in May it would move rsETH to Chainlink’s cross-chain protocol, and its latest statement says that migration is underway. “We look forward to having our day in court,” Kelp said. Related Listen: How DeFi Remains Secure in a World of Always On AI Hacks: Uneasy Money The post Kelp DAO Sues LayerZero and CEO Bryan Pellegrino Over $292 Million rsETH Bridge Exploit appeared first on Unchained .

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