Kelp DAO hit by more than $290 million crypto theft

Over the weekend, hackers stole more than $290 million in cryptocurrency from Kelp DAO, a protocol—which is a set of rules or a platform in the crypto ecosystem—that allows users to earn yields on idle crypto investments. By Monday, LayerZero, one of the projects affected by the hack, accused North Korea of carrying out the heist. In a post on X, LayerZero cited preliminary indicators that point to North Korea as the culprit behind the attack. Specifically, the company identified TraderTraitor, a hacking group that targets crypto and is attributed to North Korea, as the perpetrator of the massive theft.

The technical mechanism of the hack involved the LayerZero bridge, which is a tool allowing different blockchains to communicate by sending instructions to each other. According to LayerZero, the hackers exploited Kelp DAO via this bridge. The attackers then took advantage of Kelp DAO’s own security configuration, which did not require multiple verifications before approving transactions. This specific vulnerability allowed the hackers to siphon off the funds with fraudulent transactions. Kelp DAO responded to the incident by blaming LayerZero for the theft.

The incident is now the largest crypto theft of the year so far, surpassing an earlier hack at crypto exchange Drift in April that netted hackers around $285 million. The scale of the heist underscores how North Korean hackers working for Kim Jong Un’s regime have become highly successful at stealing crypto in the last few years. Last year, North Korean hackers stole more than $2 billion in cryptocurrency. Overall, since 2017, the total amount of stolen crypto by North Korea is said to be around $6 billion, reflecting a highly successful and sustained campaign of state-sponsored cybercrime.

Why it matters

This incident is the largest crypto theft of the year, highlighting the persistent security vulnerabilities in cross-chain bridges and the escalating financial scale of state-sponsored cybercrime.