Ethena Halts Ethereum OFT Bridges Following $292M KelpDAO rsETH Exploit, Citing Cross-Chain Security Risks

“While Ethena has no direct exposure to the KelpDAO exploit, the team believes pausing Ethereum mainnet OFT bridges is prudent until the full attack vector is understood,” the protocol stated in a community update.

The action mirrors recent steps by SparkLend, which halted rsETH collateral onboarding, and Lido, which paused certain stETH bridge routes for security review. Collectively, the responses demonstrate proactive risk management within DeFi as protocols prioritize user safety over uptime.

Bridged Liquid Restaking Tokens Under Scrutiny

The exploit has intensified debate around bridged liquid restaking token security. Unlike native L1 assets, these tokens combine three risk layers: smart contract risk at the LRT protocol level, restaking slashing risk via EigenLayer, and now cross-chain bridge risk.

DeFi security firms have warned that the rapid proliferation of LayerZero OFT and other bridge standards for LRTs has outpaced security audits. With over $14 billion in liquid restaking TVL, even minor vulnerabilities can lead to systemic losses.

Analysts note that Aave’s market freeze prevented cascading liquidations but also left users unable to adjust positions. Ethena’s pause ensures no new USDe or ENA can be bridged to or from Ethereum until reviews conclude, limiting exposure if similar flaws exist elsewhere.

Industry Response and Next Steps for Cross-Chain Security

LayerZero Labs confirmed it is conducting a post-mortem with KelpDAO and independent auditors. Preliminary findings suggest the issue was implementation specific rather than a flaw in the core OFT standard. However, all OFT integrators are urged to re-audit bridge configurations.

For Ethena, the team said bridges will resume once “security guarantees are re-established” and cross-chain risk assessments are complete. No timeline was provided. The protocol continues to operate normally on the Ethereum mainnet, with only bridging functions affected.

The incident underscores a maturing DeFi risk culture. Rather than waiting for direct impact, protocols like Ethena, Lido, and SparkLend are opting for preventive pauses. This approach reduces contagion but highlights how interconnected liquid restaking and bridging infrastructure have become.

As of publication, rsETH trading remains volatile, and Aave governance is discussing long-term risk parameters for bridged LRTs. The broader DeFi community awaits LayerZero’s final report to determine whether other OFT deployments require changes, including those integrated with major DEX platforms like Curve DAO.