What is Kelp DAO? rsETH Liquid Restaking Explained

Kelp DAO is a multi-chain liquid restaking protocol that allows users to deposit ETH or liquid staking tokens and receive rsETH — a liquid restaking token earning both Ethereum staking rewards and EigenLayer AVS restaking yield. Kelp positions itself alongside Renzo and ether.fi in the liquid restaking token (LRT) category that dominated DeFi narratives in 2024–2025.

Kelp expanded beyond Ethereum to Layer 2 networks and alternative chains, with rsETH bridged across ecosystems for use as DeFi collateral — a composability choice that became central to the protocol's story when a bridge vulnerability was exploited in April 2026.

rsETH and restaking yield

• Deposit ETH, stETH, or other supported LSTs into Kelp
• Receive rsETH — exchange rate appreciates as staking + restaking rewards accrue
• KERNEL token: Kelp governance and incentive token
• DeFi composability: rsETH used as collateral on Aave, in Pendle fixed-yield markets, and cross-chain
• Multi-chain: rsETH bridged to Arbitrum, Base, and other networks for broader DeFi access

The April 2026 bridge exploit

On April 18, 2026, an attacker exploited a vulnerability in KelpDAO's cross-chain bridge message verification, draining approximately $292M in rsETH — one of the largest DeFi exploits of the year. rsETH depegged sharply as holders rushed to exit, and contagion spread to other restaking tokens and lending protocols holding rsETH as collateral.

The incident became a case study in composability risk: restaking tokens used simultaneously as bridge collateral, lending collateral, and yield farm assets created correlated failure modes across the DeFi stack. KelpDAO paused affected bridge routes and worked with security firms on remediation.

Frequently Asked Questions

• What is Kelp DAO? Kelp DAO is a liquid restaking protocol issuing rsETH — a token representing ETH restaked via EigenLayer with automatic reward accrual.
• What is rsETH? rsETH is Kelp's liquid restaking token. It represents a restaked ETH position and is usable in DeFi lending, DEXes, and yield strategies.
• What happened in the KelpDAO hack? A bridge message verification flaw allowed forged withdrawal messages, draining $292M in rsETH in April 2026.
• Is rsETH safe after the exploit? Bridge infrastructure was paused and remediated; users should verify current Kelp security audits and bridge status before depositing.
• Kelp vs Renzo vs ether.fi? All three offer liquid restaking tokens (rsETH, ezETH, eETH) earning EigenLayer yield. They differ in custody model, token mechanics, and DeFi integrations.