<![CDATA[What happened in the Kelp DAO exploit and why does it matter?]]>17a276a8-b053-45a7-bb83-5b2d4ce4de42-image.png
Q: What exactly happened during the exploit?
Hackers targeted Kelp DAO by exploiting a vulnerability in its LayerZero bridge. They minted 116,500 rsETH tokens worth around $293 million and used them as collateral on Aave to borrow funds. This created a large hole in Aave’s system, known as “bad debt.”

Q: Why is this a big deal for DeFi?
This incident shows how interconnected DeFi protocols are. A single exploit didn’t just affect Kelp DAO—it triggered liquidity issues and massive withdrawals on Aave, with nearly $10 billion leaving the platform. It highlights how risks can spread quickly across the ecosystem when protocols depend on each other.

]]>https://undeads.com/forum/topic/18809/what-happened-in-the-kelp-dao-exploit-and-why-does-it-matterRSS for NodeTue, 09 Jun 2026 07:13:56 GMTTue, 21 Apr 2026 12:22:13 GMT60<![CDATA[Reply to What happened in the Kelp DAO exploit and why does it matter? on Tue, 21 Apr 2026 14:52:20 GMT]]>ten billion leaving the platform just a minor inconvenience

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