Kelp and Aave have begun asset recovery efforts after a $292 million hack, with plans to recover 117,132 rsETH in two weeks.
Kelp and Aave have commenced efforts to recover assets following a significant hack in April that led to a loss of $292 million. The goal is to recover 117,132 rsETH within a two-week timeframe.
Both protocols have taken crucial steps to back rsETH, including the destruction of the exploiter’s rsETH on Arbitrum. The recovery will involve gradually refilling the LayerZero OFT adapter on the mainnet.
— Kelp (@KelpDAO) May 12, 2026
The initial transfer of funds to the mainnet is imminent, with Kelp planning to enable withdrawals shortly thereafter, allowing users to access their deposits, minting, and cross-chain transactions.
In a bid to enhance security, Kelp has modified the LayerZero bridge settings, now requiring four independent nodes to validate transactions instead of one, and increasing the block confirmation requirement from 42 to 64. Additionally, the protocol is moving towards integrating Chainlink's CCIP technology.
Aave has confirmed that it has begun disbursing funds and has burned the rsETH tokens held by the hacker on the Arbitrum network.
The initial phases of the rsETH recovery plan are complete, including the burning of the exploiter's rsETH on Arbitrum. The next steps involve refilling the LayerZero OFT adapter and resuming rsETH operations.
— Aave (@aave) May 12, 2026
Previously, Aave's team faced legal challenges regarding the freezing of certain funds due to lawsuits against North Korea by terrorism victims. A court ruling permitted the transfer of these assets to Aave, though their sale remains prohibited until a final judgment is reached.
LayerZero has acknowledged its role in the incident, admitting that its default security settings were inadequate for protocols managing substantial locked funds. The April attack on Kelp, linked to the Lazarus Group, has been identified as the largest hack in the DeFi sector for the year.
In May, as part of the recovery strategy, Aave liquidated the remaining positions of the Kelp hacker in rsETH. Additionally, the Arbitrum community voted in favor of transferring 30,765 ETH, valued at $70 million, to the DeFi United fund.
