- Kelp and Aave burned exploiter rsETH and began refilling 117,132 tokens over two weeks.
- Withdrawals, deposits, and all rsETH operations resume within 24 hours of the first tranche transfer.
- Security upgrades include four attestors, raised block confirmations, and migration to CCIP bridging.
Kelp DAO and Aave have completed the first critical steps of their recovery plan following the rsETH exploit that disrupted both protocols in April. The exploiter’s rsETH tokens on Arbitrum have been burned, and a structured refill process is now underway to restore full backing for the asset.
117,132 rsETH tokens will be progressively moved from the Aave Recovery Guardian and Kelp Recovery Safe into the LayerZero OFT adapter on Ethereum mainnet over the next two weeks. Both teams confirmed that rsETH remains fully backed at all times throughout the process.
When Normal Operations Resume
Kelp said it expects to unpause withdrawals within approximately 24 hours of the first token tranche being transferred to the LayerZero adapter. Once contracts are unpaused, all rsETH operations, including deposits, redemptions, bridging, and claims, will resume as normal.
The phased approach is deliberate. Rather than restoring everything at once, the teams are rebuilding liquidity gradually to ensure stability during the transition. Users should expect temporary parameter adjustments, such as modified loan-to-value ratios or supply caps, as confidence in the asset is restored.
Security Changes Made
Following the exploit, Kelp completed a full security review across all LayerZero bridging configurations. The changes made include:
- Verification now requires four independent attestors instead of fewer
- Block confirmations raised from 42 to 64
- All layer two to layer two bridging routes have been deprecated
- Changes have been independently audited by BailSec
Kelp also confirmed it is migrating to Chainlink’s CCIP protocol for cross-chain bridging, replacing the current LayerZero infrastructure with what the team described as a more secure alternative.
Compensation Is Live
DeFi United has confirmed that compensation for affected wallets is now live. Eligible users can claim reimbursements directly through the Kernel DAO platform at kerneldao.com.
The $71 Million Legal Battle Continues
Separately, Arbitrum delegates have initiated a binding governance vote to transfer the $71 million in disputed ETH from the exploit to an Aave-controlled wallet, following a Manhattan federal court order last week that cleared the way for the transfer.
North Korean terrorism creditors are still fighting for ownership of the funds in the same court, meaning the legal dispute continues even as the operational recovery proceeds.
Related: Aave Under Strain as KelpDAO Exploit Disrupts DeFi Lending Markets
Disclaimer: The information presented in this article is for informational and educational purposes only. The article does not constitute financial advice or advice of any kind. Coin Edition is not responsible for any losses incurred as a result of the utilization of content, products, or services mentioned. Readers are advised to exercise caution before taking any action related to the company.
