Kelp (rsETH)
About
Kelp is a multichain liquid restaking platform and one of the largest Liquid Restaked Token (LRT) issuers on Ethereum, part of the KernelDAO ecosystem. Users deposit ETH or major Liquid Staking Tokens (LSTs) and receive rsETH, a liquid receipt token that remains composable across 50+ DeFi protocols (Aave, Compound, Morpho, Balancer, etc.) while the underlying assets are staked on Ethereum and restaked via EigenLayer's Actively Validated Services (AVSs). It targets both retail restakers seeking simplified, liquid exposure to restaking rewards and AVS operators needing efficient access to pooled restaked security.
Where Does Yield Come From?
rsETH earns yield from three layers of activity:
- Base staking rewards — The ETH or liquid staking tokens you deposit are staked on Ethereum's proof-of-stake network, earning the usual validator rewards.
- Restaking rewards — Those same staked assets are also delegated to services built on EigenLayer (called AVSs) that need security. The assets help secure those extra networks and services, earning additional rewards.
- DeFi yields — rsETH itself can be used inside other DeFi apps like Aave, Compound, or Uniswap for lending, borrowing, or trading, generating further returns on top.
Before the remaining yield reaches rsETH holders, the protocol takes a commission from both the base staking rewards and the restaking rewards.
The protocol's operators handle the job of choosing which AVSs to delegate to and managing those delegations. This spares restakers from having to research and pick individual services and validators themselves — the protocol does the heavy lifting.
All reward streams are collected together by smart contracts (designed with separate modules for deposits, delegations, and withdrawals) and flow into the value of the rsETH token.
Additionally, people who hold and stake the protocol's $KERNEL token can act as slashing insurance for rsETH. In return for taking on that risk, they earn a share of the protocol's rewards.
No current APY or APR figures are given here — those change over time based on AVS reward schedules and on-chain conditions.
Audits
| Audit / Date | Findings | Verdict |
|---|---|---|
Sigma Prime01-12-2023 |
| The Sigma Prime audit found two medium-severity issues — duplicate node delegators and rsETH price manipulation via direct asset transfers — both of which were resolved by the Kelp team, alongside three low-severity and five informational findings; overall the codebase demonstrated a sound security posture for launch with all actionable medium-risk items remediated. |
Code4rena10-11-2023 - 15-11-2023 |
| The audit reveals several material risks—particularly an inflation bug (H-02) that directly causes user loss and a donation attack on the first deposit (H-03)—which were confirmed but only partially addressed on-chain. The protocol should be deployed only after implementing the recommended mint-order fix and initial liquidity seeding to mitigate residual share-price manipulation. |
MixBytes29-01-2024 - 27-02-2024 |
| The 4 High-severity vulnerabilities, which were absent from the version already deployed on mainnet, were fixed, but several Medium-severity centralization and oracle-manipulation risks remain acknowledged as residual concerns by the client. The multi-asset pool design relying on Chainlink oracles rather than AMM or collateral-debt mechanics introduces inherent arbitrage and yield-stealing vectors that the client considers economically impractical at current TVL. |
| The audit found one high-severity accounting flaw (resolved) and two medium-severity risks (resolved/mitigated), with the remaining findings being low-severity or informational; the resolved status of all material issues indicates that the updated contracts were in a reasonably secure state at the end of the engagement. | |
Sigma Prime01-06-2024 |
| The audit reveals two critical accounting bugs that were resolved before deployment, and several medium/low risks were either fixed or accepted with compensating controls (e.g., long withdrawal delays for oracle sandwiching). The overall security posture of the LRT-ETH withdrawals module is sound for its current scope, though the team should revisit the closed issues if support for non-ETH assets is added. |
Sigma Prime30-09-2024 |
| All three High-severity vulnerabilities were resolved, and the critical attack vectors (front-running, forced undelegation, frozen withdrawals) were mitigated through code fixes and circuit breakers, significantly reducing the residual risk for the PEPE Upgrade integration. |
Sigma Prime01-11-2024 |
| All critical and high issues were either resolved or acknowledged, with the critical shares-calculation bug and the two high-severity findings addressed; the only unmitigated residual risk is the closed high-severity item (KRSA-03) where price fluctuations can cause minor token staking in the adapter, which the team accepts as a design trade-off. |
| The audit identified no critical vulnerabilities and only one high-severity finding (stale pricing), which the team intentionally closed as a design choice, while all other findings were either resolved or acknowledged as correctly configured in production, indicating a reasonable security posture for the June 2025 upgrades. | |
Bailsec01-09-2025 |
| The audit identified three high-severity issues—fee-limit blocking price updates, stale-price arbitrage, and bypass of uncompleted-withdrawal limits—all acknowledged or fixed, but several medium-risk design flaws (oracle staleness, accounting drift, instant-withdrawal griefing) remain acknowledged rather than resolved, meaning residual risk exists for users interacting during price volatility or slashing events. |
| The audit found no critical or high-severity vulnerabilities; the 7 low, 8 informational, and 1 governance issues were either fixed or acknowledged, indicating the Aave v3 integration and access-control changes were implemented with a reasonable security posture for a diff-based review. |
Backers
Kelp (part of KernelDAO) raised a $9 million private sale in May 2024, led by SCB Limited (a proprietary trading firm based in the Bahamas) and Laser Digital (the digital asset subsidiary of Nomura Group), who collectively invested $3.5 million. Additional participating funds included Bankless Ventures, Hypersphere, Draper Dragon, DACM, Cypher Capital, ArkStream Capital, Cluster Capital, GSR, Longhash Ventures, Side Door Ventures, NOIA Capital, HTX Ventures, Avid3 (Avid VC), ViaBTC Capital, DWF Ventures (DWF Labs), Coinseeker, and Tulipa Capital. Notable angel investors included Scott Moore (Co-founder, Gitcoin), Alex Karl Svanevik (CEO, Nansen), Sam Kazemian (Co-founder, Frax Finance), Marc Zeller (Aave Chan Initiative), Amrit Kumar (COO, Altlayer), Anthony Lesoismein (Co-founder of Swissborg), Mr. Block, and Winslow Strong (Co-founder of Cluster Capital). Key community voices included AshCrypto, SanyuanVC, Cryptodiffer, Hashuer, CryptoBanter, and Momentum6.
In November 2024, Binance Labs invested in Kernel / Kelp, alongside existing backers SCB Limited, Laser Digital, Bankless Ventures, Hypersphere, Draper Dragon, DACM, CYPHER, ArkStream Capital, HTX Ventures, Avid VC, GSR, Cluster Capital, Longhash Ventures, Via BTC, Side Door Ventures, NOIA, and DWF Labs (the amount was not disclosed).
In 2024, KernelDAO secured approximately $10 million in total funding led by Laser Digital, SCB Limited, Hypersphere Ventures, and others.
In January 2025, KernelDAO launched a $40 million Ecosystem Fund to expand BNB Chain restaking, with backing from Cypher Capital, Laser Digital, SCB Limited, Hypersphere Ventures, ArkStream, and Levitate Labs.
Legal
Legal form
Corporation (Inc.)
Status and notes
Operator: Evercrest Technologies Inc. ("Company"), disclosed as the data controller and service provider in the Privacy Notice and Terms of Service. Privacy Policy and Terms of Use linked from the site footer (hosted as Google Docs) are accessible and contain detailed legal terms. Grievance Officer: Rushabh Gurav ([email protected]). The Terms also reference August (for Kelp Gain vaults) as a separate technology provider. Jurisdiction of incorporation is not explicitly stated in the available documents.