Ethereum liquid staking protocol Kelp DAO says the repurposed Ether token has been reinstated with a five-week recovery period after the protocol was misused by North Korea’s Lazarus Group on April 18 worth $293 million.
Kelp DAO posted to
“This concludes the operational portion of the rsETH recovery plan,” Kelp said. Several crypto protocols have contributed funds to help restore rsETH’s support under the DeFi United initiative.
Source: Stani Kulekhov
The Kelp DAO hack in April caused a ripple effect on the crypto lending market, disrupting billions of dollars in liquidity and resurrecting concerns about the interconnectedness of decentralized financial protocols.
Aave became one of the hardest hit when the Kelp DAO attacker posted a large portion of the stolen 116,500 rsETH as collateral on its lending platform to borrow wrapped Ether, leaving $190 million in bad debt and triggering a wave of withdrawals.
The Kelp DAO hack was one of 25 crypto hacks in April that racked up a total of $630 million in losses, the worst month since February 2025, when crypto exchange Bybit was hacked for a record $1.5 billion.
The first tranche of 25,000 rsETH was transferred on May 13, allowing the rsETH bridge between the Ethereum mainnet and the blockchain’s Layer 2 networks to reopen.
Kelp reopened withdrawals for rsETH the next day and said Tuesday that rsETH coins, redemptions and rewards were “running normally.”
Aave’s TVL bleeding stops, but has not recovered
The Kelp DAO exploit contributed to Aave’s total value dropping from $26.4 billion to less than $14 billion, losing its long-held position as TVL’s largest DeFi protocol.
DefiLlama data shows that net outflows from Aave’s credit markets have declined over the past month.
However, Aave’s TVL shows no signs of recovery, hovering between $13.9 billion and $15.1 billion since about a week after the incident occurred.
Source: Change in TVL from Aave in 2026. Source: DefiLlama