Kraken said on Thursday that it has replaced LayerZero with Chainlink’s Cross-Chain Interoperability Protocol. The exchange will use CCIP as the only cross-chain system for Kraken Wrapped Bitcoin and future wrapped tokens. The move follows growing scrutiny around LayerZero after the Kelp DAO exploit in April.
Kraken said Chainlink CCIP meets enterprise security standards. It pointed to certifications, secure-by-default design, 16 independent nodes, and native rate limits. The company said it wants stronger controls for wrapped asset transfers across DeFi.
LayerZero came under pressure after the April Kelp DAO exploit. Attackers stole about $292 million in liquid restaking tokens. Investigators linked the attack to actors suspected of working with North Korea’s Lazarus Group.
On May 9, LayerZero issued what it called an overdue apology. It said it had done a terrible job with communications over the prior three weeks. The team also said internal RPCs were attacked, and their source of truth was poisoned.
LayerZero also said external RPC providers faced a denial of service attack. Still, it blamed Kelp’s setup and its single-DVN structure for the incident. The protocol said no other application was affected, and more than $9 billion in bridged assets have moved through it since April 19.
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Kraken is not alone. Kelp DAO said it is also moving to Chainlink CCIP. It burned the hacker’s 117,132 rsETH this week as part of its recovery process.
Solv Protocol announced on May 7 that it would shift from LayerZero to CCIP. The move covers its $700 million in tokenized Bitcoin. A day later, on-chain reinsurance protocol Re said it would migrate its $475 million in total value locked to Chainlink.
More than $3 billion in TVL has moved to CCIP since the Kelp attack, according to MEXC. Several protocols have also paused bridging through LayerZero. Lido, the largest Ethereum liquid staking protocol, already uses CCIP.
Chainlink said its defense-in-depth model sets a standard for cross-chain interoperability. Kraken also said the partnership can expand utility and distribution for Kraken Wrapped Assets across DeFi.
Kraken has shifted its cross-chain infrastructure from LayerZero to Chainlink CCIP after growing security concerns linked to the Kelp DAO exploit. Several major DeFi protocols have also started migrating assets, while Chainlink continues gaining adoption across the cross-chain interoperability market.