The recent recovery of Kelp DAO's restaked Ether token, known as rsETH, comes after a significant exploit that resulted in a loss of $293 million on April 18. The final batch of 20,373.7 rsETH tokens was successfully sent to the LayerZero smart contract, marking the completion of a five-week recovery initiative. Kelp DAO announced that operations for minting, redeeming, and rewarding rsETH have returned to normal since the reopening of withdrawals earlier this month.
This hack, attributed to North Korea’s Lazarus Group, triggered widespread disruption across the crypto lending landscape, significantly impacting platforms such as Aave. Aave faced a dramatic drop in total value locked (TVL), plummeting from $26.4 billion to below $14 billion, losing its title as the leading DeFi protocol. The exploit involved the attacker using a portion of the stolen 116,500 rsETH as collateral, resulting in $190 million in bad debt.
Despite the turmoil caused by the hack, recent data indicates that net outflows from Aave's lending markets have started to stabilize. The Kelp DAO incident was part of a broader trend in April, which saw a total of $630 million lost across 25 crypto hacks, making it the most damaging month since February 2025.