Lido: EarnETH approximately 9% exposure affected by the KelpDAO incident, stETH and wstETH are unaffected

BlockBeats News, April 23 — Lido has released the latest update on the KelpDAO security incident, stating that its Earn series vaults are working with the management team to address the issues, involving risks related to rsETH exposure and liquidity stress in the lending market. The core staking protocol remains unaffected; both stETH and wstETH are unaffected. Currently, only the EarnETH vault has approximately 9% of TVL exposed to rsETH, with related deposits and withdrawals paused by the management team while awaiting a solution.

In the previous attack, about $70 million worth of ETH has been recovered, and the process of asset recovery and loss allocation is ongoing. To address liquidity pressure, the management team 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. Regarding other vaults, DVV and EarnUSD are unaffected and operating normally; GGV sub-vaults are experiencing negative yields due to a combination of a cyclical staking strategy and rising lending rates, but are actively adjusting. User withdrawal requests submitted earlier will be processed based on pre-incident valuations.