{"id":71465,"date":"2026-04-21T17:07:17","date_gmt":"2026-04-21T17:07:17","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/charles-hoskinson-points-to-cardano-and-midnight-as-fix-for-cross-chain-flaws-behind-kelpdao-hack-bitcoin-news\/"},"modified":"2026-04-21T17:07:17","modified_gmt":"2026-04-21T17:07:17","slug":"charles-hoskinson-points-to-cardano-and-midnight-as-fix-for-cross-chain-flaws-behind-kelpdao-hack-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/charles-hoskinson-points-to-cardano-and-midnight-as-fix-for-cross-chain-flaws-behind-kelpdao-hack-bitcoin-news\/","title":{"rendered":"Charles Hoskinson Points to Cardano and Midnight as Fix for Cross-Chain Flaws Behind KelpDAO Hack \u2013 Bitcoin News"},"content":{"rendered":"<p><b>(Originally posted on : Bitcoin News )<\/b><br \/>\n<\/p>\n<div>\n<p><strong>Key Takeaways:<\/strong><\/p>\n<ul>\n<li aria-level=\"1\">An attacker exploited KelpDAO\u2019s cross-chain bridge on April 18, stealing 116,500 restaked <span>ETH<\/span> worth roughly $292 million.<\/li>\n<li aria-level=\"1\">The breach triggered more than $13 billion in <span>DeFi<\/span> TVL outflows within 48 hours, hitting Aave, Compound, Morpho, and at least 9 other protocols.<\/li>\n<li aria-level=\"1\">Charles Hoskinson says Midnight\u2019s zero-knowledge proofs and multi-party computation could prevent this class of attack from repeating.<\/li>\n<\/ul>\n<h2>Hoskinson Explains Why Cardano\u2019s Non-Custodial <span>Staking<\/span> Sidesteps <span>Restaking<\/span> Risk<\/h2>\n<p><a href=\"https:\/\/news.bitcoin.com\/cardano-founder-hoskinson-bitcoins-quantum-fix-is-a-hard-fork-in-disguise\/\">Charles Hoskinson<\/a>, founder of Cardano and Ethereum co-founder, broke down the attack in a <a href=\"https:\/\/www.youtube.com\/live\/dV7enjf2cJY?si=KiV7C-NvAZSv4CMT\" target=\"_blank\" rel=\"noopener noreferrer\">video<\/a> published from Wyoming, walking viewers through a custom artificial intelligence (AI)-generated incident report website.<\/p>\n<p>\u201cThe standard <span>DeFi<\/span> threat model assumes <span>smart contract<\/span> bugs are the dominant risk,\u201d Hoskinson said. \u201cThat\u2019s not true anymore.\u201d<\/p>\n<p>He added:<\/p>\n<blockquote>\n<p>\u201cBridges can be very problematic. A one-of-one verifier is not good. Don\u2019t do that. And then the problem is that if they steal the money, <span>DeFi<\/span> lending is the exit condition. So basically, you can deposit, you can lend, and when you get those tokens, you\u2019re getting tokens unconnected to the theft, and the collateral is poisoned effectively.\u201d<\/p>\n<\/blockquote>\n<p>The attacker submitted a spoofed Layerzero message that reached the endpoint v2 contract connected to Kelp\u2019s <span>restake<\/span> adapter, which then released the tokens from an Ethereum escrow. The forged packet claimed Uni-Chain endpoint ID 30320 as its source. Kelp\u2019s cross-chain configuration relied on a single decentralized verifier network, a one-of-one setup that gave the attacker a single point to compromise.<\/p>\n<p>The stolen tokens were not sold directly on <span>decentralized exchange<\/span> ( <span>DEX<\/span>) platforms, which would have crashed the price. The attacker deposited the restaked <span>ETH<\/span> as collateral in lending markets like <a href=\"https:\/\/news.bitcoin.com\/defi-lender-aave-battles-withdrawal-crisis-after-kelpdao-rseth-exploit\/\">Aave<\/a> before Kelp or its partners could freeze positions, borrowing liquid wrapped ether against it and walking away with assets unconnected to the original theft. The poisoned collateral remained inside the borrowing markets.<\/p>\n<p>Llamarisk\u2019s <a href=\"https:\/\/news.bitcoin.com\/incident-report-llamarisk-aave-service-providers-detail-kelp-rseth-hack-across-ethereum-and-arbitrum-markets\/\">joint incident report<\/a>, published April 20, confirmed 83,471 <span>ETH<\/span> equivalent spread across seven attacker wallets on Ethereum core and Arbitrum. The report outlined two resolution scenarios. The first socializes a 15.12% haircut across all restaked <span>ETH<\/span> holders, producing roughly $123 million in bad debt absorbed by Ethereum core\u2019s reserve. The second isolates losses at the layer two ( <span>L2<\/span>) level, repricing tokens to 26.46% backing and generating about $230 million in bad debt concentrated across Mantle, Arbitrum, and Base, while leaving Ethereum core untouched.<\/p>\n<p>Aave alone saw between $6.6 billion and $8.45 billion in outflows. Wrapped <span>ETH<\/span> pools on Arbitrum, Base, Mantle, Linia, and Plasma hit near 100 percent utilization, effectively blocking withdrawals. At least nine <span>DeFi<\/span> protocols were classified as directly affected, including Compound, Morpho, Lido, Ethena, Pendle, Euler, Beefy, and Lombard Finance.<\/p>\n<p>Three separate post-mortems have been published by <a href=\"https:\/\/x.com\/KelpDAO\/status\/2046332070277091807?s=20\" target=\"_blank\" rel=\"noopener noreferrer\">KelpDAO<\/a>, <a href=\"https:\/\/news.bitcoin.com\/layerzero-claims-zero-contagion-after-290m-exploit-as-disputed-narratives-deepen-scrutiny\/\">Layerzero<\/a>, and <a href=\"https:\/\/news.bitcoin.com\/incident-report-llamarisk-aave-service-providers-detail-kelp-rseth-hack-across-ethereum-and-arbitrum-markets\/\">Llamarisk<\/a>. None agree on where responsibility sits. Layerzero announced April 20 that it would no longer sign or attest messages for any application running a one-of-one DVN configuration, pushing a protocol-wide migration to multi-verifier setups. Kelp maintains that Layerzero\u2019s default configuration shipped with single-source verification across Ethereum, <span>BNB<\/span> Chain, Polygon, Arbitrum, and Optimism, and that allegedly <a href=\"https:\/\/news.bitcoin.com\/dune-data-reveals-close-to-50-of-layerzero-apps-use-basic-security\/\">40% to 50%<\/a> of all Layerzero OFT applications currently use the same one-of-one setup.<\/p>\n<p>Onchain forensics <a href=\"https:\/\/news.bitcoin.com\/lazarus-group-suspected-of-moving-175m-in-eth-after-arbitrum-freezes-71m-from-kelpdao-exploit\/\">suggest connections<\/a> to the Lazarus Group, a state-sponsored hacking collective linked to North Korea. No independent forensics firm has issued a formal attribution, and the FBI has not commented publicly.<\/p>\n<h2>Hoskinson: \u2018If You\u2019re in Cardano Land, You Just Click Delegate \u2026 We\u2019re Liquid Non-Custodial\u2019<\/h2>\n<p><a href=\"https:\/\/news.bitcoin.com\/cardano-founder-hoskinson-bitcoins-quantum-fix-is-a-hard-fork-in-disguise\/\">Hoskinson<\/a> pointed to the attack as evidence that bridge verification failures have replaced <span>smart contract<\/span> bugs as the primary <a href=\"http:\/\/www.bitcoin.com\/get-started\/what-is-defi-decentralized-finance\/\" class=\"lar_link lar_link_outgoing\" target=\"_blank\" rel=\"noopener noreferrer\">DeFi<\/a> threat vector. He cited the $46-minute window between the initial drain and Kelp\u2019s emergency pause as a sign that incident response matters but cannot outrun the speed at which stolen assets can be deployed into lending markets.<\/p>\n<p>\u201cWhat makes this novel is the contagion,\u201d Hoskinson explained in his video. \u201cIt wasn\u2019t just a bridge hack. It spread to lending, which then created bad debt contagion inside these lending protocols. It created a bank run, and we saw $13 billion of TVL pulled in a very short period of time for a $290 million hack. That\u2019s a crisis of confidence.\u201d<\/p>\n<p>He framed <a href=\"https:\/\/news.bitcoin.com\/cardano-trader-vaporizes-6m-in-ada-after-stablecoin-swap-goes-off-the-rails\/\">Cardano<\/a>\u2018s lower exposure as a function of its liquid, non-custodial <a href=\"http:\/\/www.bitcoin.com\/get-started\/what-is-staking\/\" class=\"lar_link lar_link_outgoing\" target=\"_blank\" rel=\"noopener noreferrer\">staking<\/a> design, which removes the need for the staking-to-liquid-staking-to- <a href=\"http:\/\/www.bitcoin.com\/get-started\/what-is-restaking\/\" class=\"lar_link lar_link_outgoing\" target=\"_blank\" rel=\"noopener noreferrer\">restaking<\/a> wrapper chain that created the attack surface at Kelp. Hoskinson argued that <a href=\"https:\/\/midnight.network\/night\" target=\"_blank\" rel=\"noopener noreferrer\">Midnight<\/a>, Cardano\u2019s privacy-focused <a href=\"http:\/\/www.bitcoin.com\/get-started\/what-are-sidechains\/\" class=\"lar_link lar_link_outgoing\" target=\"_blank\" rel=\"noopener noreferrer\">sidechain<\/a>, addresses the core vulnerabilities involved.<\/p>\n<p>Its Nightstream protocol folds entire chain states into proofs that travel alongside cross-chain messages, making forged messages verifiable before acceptance. \u201cWhen people send messages, they can verify that what they\u2019re seeing is correct,\u201d he said. Multi-party computation support on Midnight would allow Layerzero to deploy turnkey two-of-three or five-of-seven DVN configurations with less operational friction.<\/p>\n<div class=\"not-prose my-3 lg:my-4\">\n<div class=\"flex flex-col overflow-hidden rounded-lg !bg-[#E8EDFA] p-[9px] md:hidden\">\n<div class=\"relative aspect-video w-full overflow-hidden rounded-[15px]\"><\/p>\n<h3 class=\"absolute inset-x-0 bottom-0 m-0 p-3 text-xl font-bold capitalize leading-[1.17] tracking-[-0.4px] !text-white\">Charles Hoskinson Predicts Bitcoin Could Hit $500K in 2 Years, Likening It to Gold for the Internet<\/h3>\n<\/div>\n<div class=\"flex flex-col gap-2.5 px-1 pt-2.5 pb-1\">\n<p class=\"m-0 line-clamp-2 text-xs leading-[1.3] !text-[#67656E]\">Cardano founder Charles Hoskinson envisions a glowing trajectory for bitcoin, predicting the top cryptocurrency could soar to $250,000\u2013$500,000 per coin\u2026<\/p>\n<p><a class=\"flex h-[38px] w-full items-center justify-center rounded-pill bg-[#4169E1] text-sm font-medium text-white no-underline\" href=\"https:\/\/news.bitcoin.com\/charles-hoskinson-predicts-bitcoin-could-hit-500k-in-2-years-likening-it-to-gold-for-the-internet\/\">Read Now<\/a><\/div>\n<\/div>\n<div class=\"hidden overflow-hidden rounded-lg !bg-[#E8EDFA] p-[9px] md:flex md:flex-row md:gap-3 lg:hidden\">\n<div class=\"relative size-[150px] min-w-[150px] shrink-0 overflow-hidden rounded-[15px]\"><img alt=\"Charles Hoskinson Predicts Bitcoin Could Hit $500K in 2 Years, Likening It to Gold for the Internet\" loading=\"lazy\" decoding=\"async\" data-nimg=\"fill\" class=\"object-cover\" style=\"position:absolute;height:100%;width:100%;left:0;top:0;right:0;bottom:0;color:transparent\" sizes=\"150px\" srcset=\"\/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=32&amp;q=75 32w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=48&amp;q=75 48w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=64&amp;q=75 64w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=128&amp;q=75 128w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=256&amp;q=75 256w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=384&amp;q=75 384w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=640&amp;q=75 640w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=828&amp;q=75 828w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=1080&amp;q=75 1080w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=1200&amp;q=75 1200w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=1920&amp;q=75 1920w\" src=\"https:\/\/news.bitcoin.com\/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=1920&amp;q=75\"\/><\/p>\n<div class=\"absolute left-2 top-2\"><img src=\"https:\/\/news.bitcoin.com\/images\/uploads\/bitcoin_news_newlogo.svg\" alt=\"Bitcoin.com News\" class=\"size-7\" loading=\"lazy\"\/><\/div>\n<\/div>\n<div class=\"flex min-w-0 flex-1 flex-col justify-between gap-2\">\n<h3 class=\"m-0 line-clamp-3 text-xl font-bold capitalize leading-[1.17] tracking-[-0.4px] !text-[#1C1C1C]\">Charles Hoskinson Predicts Bitcoin Could Hit $500K in 2 Years, Likening It to Gold for the Internet<\/h3>\n<p class=\"m-0 line-clamp-2 text-sm leading-[1.3] !text-[#67656E]\">Cardano founder Charles Hoskinson envisions a glowing trajectory for bitcoin, predicting the top cryptocurrency could soar to $250,000\u2013$500,000 per coin\u2026<\/p>\n<p><a class=\"flex h-[38px] w-full items-center justify-center rounded-pill bg-[#4169E1] text-sm font-medium text-white no-underline\" href=\"https:\/\/news.bitcoin.com\/charles-hoskinson-predicts-bitcoin-could-hit-500k-in-2-years-likening-it-to-gold-for-the-internet\/\">Read Now<\/a><\/div>\n<\/div>\n<div class=\"hidden overflow-hidden rounded-lg !bg-[#E8EDFA] p-[9px] lg:flex lg:flex-row lg:gap-4\">\n<div class=\"relative size-[150px] min-w-[150px] shrink-0 overflow-hidden rounded-[15px]\"><img alt=\"Charles Hoskinson Predicts Bitcoin Could Hit $500K in 2 Years, Likening It to Gold for the Internet\" loading=\"lazy\" decoding=\"async\" data-nimg=\"fill\" class=\"object-cover\" style=\"position:absolute;height:100%;width:100%;left:0;top:0;right:0;bottom:0;color:transparent\" sizes=\"150px\" srcset=\"\/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=32&amp;q=75 32w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=48&amp;q=75 48w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=64&amp;q=75 64w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=128&amp;q=75 128w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=256&amp;q=75 256w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=384&amp;q=75 384w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=640&amp;q=75 640w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=828&amp;q=75 828w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=1080&amp;q=75 1080w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=1200&amp;q=75 1200w, \/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=1920&amp;q=75 1920w\" src=\"https:\/\/news.bitcoin.com\/_next\/image\/?url=https%3A%2F%2Fstatic.news.bitcoin.com%2Fwp-content%2Fuploads%2F2024%2F11%2Fhoskhosk-150x150.jpg&amp;w=1920&amp;q=75\"\/><\/p>\n<div class=\"absolute left-2 top-2\"><img src=\"https:\/\/news.bitcoin.com\/images\/uploads\/bitcoin_news_newlogo.svg\" alt=\"Bitcoin.com News\" class=\"size-7\" loading=\"lazy\"\/><\/div>\n<\/div>\n<div class=\"flex min-w-0 flex-1 flex-col justify-center gap-2\">\n<div class=\"flex items-start gap-3\">\n<h3 class=\"m-0 min-w-0 flex-1 line-clamp-2 text-2xl font-bold capitalize leading-[1.17] tracking-[-0.48px] !text-[#1C1C1C]\">Charles Hoskinson Predicts Bitcoin Could Hit $500K in 2 Years, Likening It to Gold for the Internet<\/h3>\n<p><a class=\"flex h-12 w-[180px] shrink-0 items-center justify-center rounded-pill bg-[#4169E1] text-sm font-medium text-white no-underline\" href=\"https:\/\/news.bitcoin.com\/charles-hoskinson-predicts-bitcoin-could-hit-500k-in-2-years-likening-it-to-gold-for-the-internet\/\">Read Now<\/a><\/div>\n<p class=\"m-0 line-clamp-2 text-base leading-[1.3] !text-[#67656E]\">Cardano founder Charles Hoskinson envisions a glowing trajectory for bitcoin, predicting the top cryptocurrency could soar to $250,000\u2013$500,000 per coin\u2026<\/p>\n<\/div>\n<\/div>\n<\/div>\n<p>Zero-knowledge proofs would block poisoned messages at the verification layer. Network anonymization would make the DDoS component of this class of attack harder to execute. He said AI tools, including frontier models reportedly accessible to the Lazarus Group through bribed insiders at major AI labs, are enabling attackers to scan entire codebases for emergent vulnerabilities that no single human reviewer would detect.<\/p>\n<p>\u201cHacks are a part of life,\u201d he said, \u201cand they\u2019re going to get much, much worse for everyone.\u201d<\/p>\n<\/div>\n<p><a href=\"https:\/\/news.bitcoin.com\/charles-hoskinson-points-to-cardano-and-midnight-as-fix-for-cross-chain-flaws-behind-kelpdao-hack\/\">Source link <\/a><br \/>\n<br \/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>(Originally posted on : Bitcoin News ) Key Takeaways: An attacker exploited KelpDAO\u2019s cross-chain bridge on April 18, stealing 116,500 restaked ETH worth roughly $292 million. The breach triggered more than $13 billion in DeFi TVL outflows within 48 hours, hitting Aave, Compound, Morpho, and at least 9 other protocols. Charles Hoskinson says Midnight\u2019s zero-knowledge [&hellip;]<\/p>\n","protected":false},"author":19,"featured_media":71466,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"om_disable_all_campaigns":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0},"categories":[32],"tags":[],"_links":{"self":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/71465"}],"collection":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/users\/19"}],"replies":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/comments?post=71465"}],"version-history":[{"count":0,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/posts\/71465\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media\/71466"}],"wp:attachment":[{"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/media?parent=71465"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/categories?post=71465"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/crowdfundjunction.com\/blog\/wp-json\/wp\/v2\/tags?post=71465"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}