KelpDAO sues LayerZero and CEO over $292 million exploit

KelpDAO, through its parent company Evercrest, has filed a civil lawsuit in the Canadian province of British Columbia against blockchain protocol LayerZero and its CEO Bryan Pellegrino. The case concerns an exploit of the rsETH bridge earlier this year, in which attackers made off with approximately $292 million in tokens. Pellegrino calls the claims unfounded and says he will defend himself in Vancouver.

In brief:

• KelpDAO is suing LayerZero and CEO Pellegrino in British Columbia following a bridge exploit.
• The attack in April 2026 saw around 116,500 rsETH stolen, worth some $292 million at the time.
• LayerZero allegedly failed to disclose the risks of its technology and to protect its security infrastructure.

Exploit of rsETH bridge leads to lawsuit

In April 2026, KelpDAO’s rsETH bridge, built on the LayerZero protocol, was hit by an attack. Around 116,500 rsETH tokens were stolen, worth roughly $292 million at the time. After the exploit, the two parties became embroiled in a conflict over who was responsible for the incident.

In the complaint, KelpDAO alleges that LayerZero failed to communicate the risks of its technology and did not prevent its security infrastructure from being compromised. KelpDAO also points out that LayerZero had reviewed and approved the deployment and configuration of the bridge in writing.

Pellegrino disputes the claims

Bryan Pellegrino said via X that Evercrest, the company behind KelpDAO, has filed the civil claim in British Columbia against both LayerZero and himself personally. He calls the claims unfounded.

Pellegrino says he will contest the case in Vancouver. It is not yet clear exactly what compensation KelpDAO is seeking. How a judge apportions responsibility in this type of bridge exploit could set a precedent for similar disputes within the DeFi sector.