KelpDAO has taken cross-chain infrastructure provider LayerZero to court over the April 2026 exploit that drained 116,500 rsETH, worth about $292 million at the time.
Evercrest Technologies, the entity behind KelpDAO, filed a civil claim in the Supreme Court of British Columbia against LayerZero Labs, LayerZero Labs Canada, and co-founder Bryan Pellegrino. Kelp alleges negligence and negligent misrepresentation, arguing that LayerZero failed to disclose security risks and that its infrastructure was compromised, allowing attackers to forge a cross-chain message.
A key dispute is whether LayerZero reviewed and endorsed Kelp’s 1-of-1 Decentralized Verifier Network (DVN) configuration before the exploit. LayerZero disputes this account, saying the vulnerability resulted from Kelp’s configuration and reliance on a single DVN.
The case could help clarify whether infrastructure providers can face legal responsibility when vulnerabilities in their technology contribute to losses suffered by decentralized applications.
However, no established court precedent currently holds an on-chain infrastructure provider liable for losses from a compromised integration.
The outcome could have implications for bridges, oracle providers, validators, and other infrastructure companies serving decentralized applications, particularly around security warnings, representations, and responsibilities during integration.
