Kelp DAO, the DeFi lending protocol at the center of the $292 million bridge exploit last month, is dropping LayerZero as its cross-chain infrastructure provider in favor of Chainlink.
With the move, Kelp DAO is "the first major protocol to move away from LayerZero since the exploit," a Chainlink representative told The Block.
Many onlookers blame LayerZero at least partially for the attack. On April 18, attackers suspected to be connected to North Korea’s Lazarus Group exploited a single-verifier configuration of a LayerZero-powered Omnichain Fungible Token (OFT) bridge to drain 116,500 rsETH from Kelp DAO.
LayerZero, for its part, has criticized Kelp DAO’s 1-of-1 Decentralized Verifier Network (DVN) setup, claiming it warned against a single-verifier configuration.
However, Kelp DAO and many other onlookers note that the 1-of-1 setup was LayerZero’s default onboarding recommendation. A recent analysis, cited by Kelp, found that 47% of approximately 2,665 LayerZero applications were running the same single-verifier configuration at the time of the attack.
LayerZero has since announced it will stop signing single-verifier setups. Chainlink’s decentralized oracle networks (DONs), by contrast, require at least 16 independent node operators to validate cross-chain transactions.
"KelpDAO's migration to Chainlink CCIP directly addresses the architectural vulnerability at the center of the exploit," Kelp DAO wrote.
In addition to Kelp DAO tapping the Chainlink Cross-Chain Interoperability Protocol (CCIP), rsETH will also adopt the Cross-Chain Token (CCT) standard, the announcement reads. Chainlink's infrastructure has supported over $30 trillion in cross-chain transaction value to date.
As part of the ongoing DeFi United initiative formed after the attack to restore rsETH’s backing, LayerZero contributed about 10,000 ETH, including a 5,000 ETH donation and a 5,000 ETH loan to Aave. The effort has now raised over $300 million in crypto.
This weekend, supposed victims of previous North Korean hacks sued Arbitrum DAO to seize 30,766 ETH that the Arbitrum’s Security Council had frozen following the Kelp DAO exploit. Arbitrum DAO had been voting to release the ETH into DeFi United.
Aave filed an emergency motion on Monday to vacate the lawsuit and lift a temporary restraining order on those funds.