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Kelp DAO Reports $293 Million Exploit Linked to Cross-Chain Bridge

Reserve states its eUSD and USD3 products face limited direct risk after the Kelp DAO LayerZero bridge attack, while it has temporarily paused several related functions as a precaution.

AAVE
RSETH
RSR

Summary

Following the reported $293 million Kelp DAO exploit tied to a cross-chain bridge, Reserve said eUSD and USD3 face minimal risk from the incident. On April 20, Reserve temporarily paused eUSD and USD3 minting, rebalancing, and RSR unstaking as a precautionary measure. Reserve added that rsETH would need to fall by 15.5% to 18.5% before Aave bad debt could potentially be affected.

Terms & Concepts
  • Cross-chain bridge: Infrastructure that transfers assets between separate blockchains, typically by locking tokens on one chain and issuing corresponding assets on another.
  • Aave: A decentralized lending protocol where users can supply crypto assets as collateral and borrow against them.
  • RSR: Reserve Rights, a token used within the Reserve ecosystem for functions including staking and supporting protocol operations.