Lido discloses Kelp security incident impact: approximately 9% exposure in EarnETH affected, core staked assets remain secure

Odaily Planet Daily reports that Lido has released the latest updates on the Kelp security incident, stating that its Earn series vaults are working with management to address the issues, involving rsETH exposure and liquidity stress in the lending market. Lido emphasizes that the core staking protocol remains unaffected, and both stETH and wstETH are secure and stable. Currently, only the EarnETH vault has an rsETH exposure of about 9% of TVL, and related deposits and withdrawals have been suspended by the management team while awaiting a solution.

Approximately $70 million worth of ETH has been recovered from the previous attack, and the process of asset recovery and loss allocation is ongoing. To address liquidity pressure, the management has reduced leverage and optimized position structures, significantly decreasing wETH debt exposure. If losses ultimately occur, EarnETH will activate a $3 million “first-loss protection mechanism” funded by the DAO. Other vaults, such as DVV and EarnUSD, remain unaffected and are operating normally; GGV sub-vaults are experiencing negative yields due to a combination of a looping staking strategy and rising borrowing rates, but are actively adjusting. User withdrawal requests submitted earlier will be processed based on pre-incident valuations.