KELPDAO FILES SUIT AGAINST LAYERZERO OVER RSETH BRIDGE EXPLOIT

Summary from the TLDR Crypto newsletter

KelpDAO filed suit against LayerZero and co-founder Bryan Pellegrino over a bridge exploit that caused losses to rsETH, its restaked ETH token, earlier in 2026. The lawsuit alleges LayerZero bears legal responsibility for the exploit, framing the breach as developer liability rather than accepted protocol risk. By pursuing traditional litigation instead of on-chain governance or negotiation, KelpDAO is testing whether US courts will assign accountability to bridge protocol teams for security failures. The case names a prominent founder personally, which could set a precedent for DeFi teams seeking recourse against infrastructure providers after exploits.