KelpDAO Sues LayerZero Over $292M Security Breach

KelpDAO has filed a lawsuit against LayerZero and its co-founder Bryan Pellegrino over a $292 million security breach that occurred in April. The incident involved the theft of 116,500 rsETH tokens from KelpDAO's cross-chain infrastructure, which was built using LayerZero's technology.

KelpDAO alleges that LayerZero concealed critical security vulnerabilities and failed to provide adequate warnings about the approved bridge configuration. The protocol claims that its architecture had been thoroughly discussed with LayerZero representatives, who gave explicit security approval beforehand.

LayerZero has responded by saying that it previously advocated for a multi-verifier configuration but was not used in KelpDAO's setup. Pellegrino characterized the allegations as 'without merit' and announced his intention to mount a vigorous defense.