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7 May 2026, 21:10
Proposal to Unfreeze $71M in Kelp DAO Funds on Arbitrum Nears Final Approval
BitcoinWorld Proposal to Unfreeze $71M in Kelp DAO Funds on Arbitrum Nears Final Approval A joint proposal to unfreeze approximately $71 million in ETH, locked following an exploit of the liquid restaking protocol Kelp DAO, is expected to pass today. The measure, submitted collaboratively by Aave Labs, Kelp DAO, and LayerZero, has garnered sufficient support and now moves to the final on-chain governance stage on Arbitrum. Background of the Frozen Funds The funds were frozen by the Arbitrum Security Council after an exploit targeted Kelp DAO, a platform that allows users to deposit ETH and receive rsETH, a liquid restaking token. The security council’s intervention was a preventive measure to protect user assets while the nature and extent of the exploit were assessed. The freezing of such a large sum — roughly $71 million in ETH — temporarily halted withdrawals and created uncertainty among rsETH holders. The Joint Recovery Proposal The proposal, submitted by Aave Labs, Kelp DAO, and LayerZero, aims to restore a portion of the rsETH collateral through the DeFi United recovery project. The collaborative nature of the proposal highlights the interconnectedness of the decentralized finance ecosystem, where protocols often work together to resolve security incidents. Upon approval, the proposal will advance to the final on-chain governance stage, where Arbitrum token holders will vote to execute the unfreezing. Why This Matters for DeFi Users The passage of this proposal is a critical step toward restoring normal operations for rsETH holders. It signals a coordinated effort among major DeFi protocols to address security breaches and protect user funds. For the broader market, it demonstrates the effectiveness of security councils and governance mechanisms in managing crises, potentially reinforcing trust in the Arbitrum ecosystem and liquid restaking protocols like Kelp DAO. Implications for the Market The unfreezing of $71 million in ETH could have a calming effect on the market, reducing the immediate selling pressure that often accompanies such incidents. It also sets a precedent for how multi-protocol recovery efforts can be structured, which may influence future incident response plans across DeFi. Investors and analysts will be watching the on-chain vote closely, as its success could pave the way for similar collaborative resolutions in the future. Conclusion The near-certain approval of the proposal to unfreeze $71 million in Kelp DAO funds marks a significant milestone in the aftermath of the exploit. The joint effort by Aave Labs, Kelp DAO, and LayerZero underscores the importance of cooperation in the DeFi space. As the final on-chain vote approaches, the community awaits the restoration of rsETH collateral and a return to normalcy for affected users. FAQs Q1: What is the Arbitrum Security Council? The Arbitrum Security Council is a group of trusted entities responsible for taking emergency actions, such as freezing funds, to protect the Arbitrum network and its users during security incidents. Q2: What is rsETH? rsETH is a liquid restaking token issued by Kelp DAO. It represents a user’s deposited ETH that is being restaked to secure other protocols, allowing users to earn additional yields while maintaining liquidity. Q3: How will the unfrozen funds be used? Upon approval, the unfrozen ETH will be used by the DeFi United recovery project to restore a portion of the rsETH collateral, helping to stabilize the protocol and enable withdrawals for affected users. This post Proposal to Unfreeze $71M in Kelp DAO Funds on Arbitrum Nears Final Approval first appeared on BitcoinWorld .
7 May 2026, 21:00
Solv moves $700 million in BTC to Chainlink CCIP
🚨 Solv Protocol is transferring $700 million in bitcoin assets to Chainlink’s CCIP. This follows a $292 million exploit tied to LayerZero bridges. Continue Reading: Solv moves $700 million in BTC to Chainlink CCIP The post Solv moves $700 million in BTC to Chainlink CCIP appeared first on COINTURK NEWS .
7 May 2026, 20:45
Solv Protocol abandons LayerZero for Chainlink's CCIP, follows KelpDAO migration
Solv Protocol has announced that it is migrating its entire $700 million tokenized Bitcoin portfolio from LayerZero to Chainlink’s Cross-Chain Interoperability Protocol (CCIP). This makes it the second major protocol to leave LayerZero’s bridging infrastructure following the controversy that surrounded its role in the $292 million KelpDAO exploit. Solv’s decision comes just two days after KelpDAO announced its own migration away from LayerZero while also accusing the platform of approving the single-verifier bridge configuration that enabled the April 18 hack. LayerZero founder Bryan Pellegrino called those claims “completely untrue”; however, that has not been enough to stop defections from his platform. Protocols are leaving LayerZero KelpDAO was the first to confirm its migration to Chainlink CCIP on May 5, while also publishing Telegram screenshots it says show a LayerZero team member writing “No problem on using defaults either” during discussions about Kelp’s bridge configuration. Kelp said those exchanges spanned eight discussions over 2.5 years without objection from LayerZero personnel. Pellegrino pushed back , writing on X that Kelp “deployed multiDVN and then manually downgraded to a 1/1” verifier setup. A 1-of-1 DVN (Decentralized Verifier Network) configuration means a single verification signature can authorize cross-chain token transfers, removing the redundancy that multi-DVN provides. Solv’s announcement did not reference the KelpDAO dispute directly but cited “recent cross-chain hacks observed in the industry” and a “full updated security review on all cross-chain interoperability solutions” as the basis for its decision to migrate. What Solv is moving Solv Protocol manages over $611 million in total value locked across Bitcoin, Ethereum, BSC, and several other chains, according to DefiLlama . The protocol is deprecating LayerZero bridging support for SolvBTC and xSolvBTC on Corn, Berachain, Rootstock, and TAC to standardize on CCIP across all supported chains. “Security is the foundation of everything we build at Solv, and our migration to Chainlink CCIP reinforces that commitment at the highest level,” Will Wang, Solv’s chief technology officer, said in the announcement. Johann Eid, chief business officer at Chainlink Labs, said in the same post that Solv’s migration “reflects a broader shift across the DeFi industry of leading protocols adopting Chainlink to deliver the highest level of security required to bring the next billion users on-chain.” Why protocols are leaving LayerZero The April 18 attack drained 116,500 rsETH from Kelp’s LayerZero-powered bridge, which is around 18% of the liquid restaked tokens in circulation. At the time of the exploit, 47% of active LayerZero OApp contracts used a 1-of-1 DVN setup; however, the platform has since banned that configuration and is pushing migrations across its application base. The ripple effect of that fallout extended to Aave, which saw its total value locked (TVL) dip by over $13 billion within days, with bad debt exposure estimated at $177 million before recovery efforts began. Protocols are replacing LayerZero’s bridge with CCIP CCIP’s architecture runs three distinct oracle networks per lane, as opposed to three nodes inside one network, according to Sergey Nazarov, the founder of Chainlink. It also has a separate risk management network that was built by a different team in a different programming language. Therefore, compromising one verification path is not enough, as it does not give an attacker access to the others. Based on an earlier report, CCIP has not disclosed a value-loss incident since launch. LayerZero pledged 10,000 ETH to the DeFi United recovery fund that was meant to make users affected by the exploit whole. Arbitrum’s Security Council froze 30,766 ETH from the attacker’s wallets, though the legal status of those funds remains contested after US claimants with terrorism-related judgments against North Korea moved to attach them. Aave has taken legal steps to get the funds released. KelpDAO’s accusation is not helping LayerZero’s credibility, and the situation just took another negative turn as two of its higher-profile integrators have left for the same competitor within a week. DefiLlama data shows LayerZero generated $197,000 in fees over the past 30 days, a figure that could compress further as protocols depart. Its token currently trades at $1.48 , a 1.6% drop over the past 24 hours. The smartest crypto minds already read our newsletter. Want in? Join them .
7 May 2026, 20:28
Aave changes collateral rules after $293 million rsETH attack
🚨 A $293 million exploit in $rsETH triggers sweeping changes at Aave. All collateral assets will now face stricter, multi-factor evaluation before listing. 🛡️ Critical step: Aave launches a new playbook to set DeFi risk standards. Continue Reading: Aave changes collateral rules after $293 million rsETH attack The post Aave changes collateral rules after $293 million rsETH attack appeared first on COINTURK NEWS .
7 May 2026, 15:14
Arbitrum vote to release $71M in frozen Kelp exploit ETH set to pass
The Snapshot vote would move the recovery effort toward a binding onchain Arbitrum governance proposal.
7 May 2026, 14:27
Aave to overhaul collateral and listing standards after KelpDAO exploit
The lending giant is expanding its asset listing criteria beyond financial risk to include cybersecurity and architecture, and wants the rest of DeFi to follow.
