Kelp DAO restores rsETH backing 5 weeks after $293M hack

Ethereum liquid staking protocol Kelp DAO has fully restored backing for its rsETH token, five weeks after a $293 million hack compromised the platform.

The exploit, which occurred last month, temporarily affected the collateralization of rsETH. Kelp DAO announced that rsETH mints, redemptions, and rewards operations have been running smoothly since it opened withdrawals earlier this month. The restoration of 100% backing marks a significant recovery milestone for the protocol, which had to suspend certain functions to contain the damage.

For crypto traders, the restoration of rsETH backing removes a key uncertainty in the liquid staking sector. Liquid staking tokens like rsETH are widely used in DeFi as collateral, and any depegging risk can ripple across multiple protocols. With full backing restored, rsETH should trade closer to its underlying ETH value, reducing systemic risk. Traders can monitor real-time rsETH prices on NowPrice to track the token's stability post-recovery.

Looking ahead, Kelp DAO's ability to maintain normal operations and prevent future exploits will be critical for rebuilding user trust. The incident highlights ongoing security challenges in DeFi, and the market will watch for any further updates on the hack investigation or additional security measures implemented by the protocol.