kpk Declares Zero Depositor Loss After $23M Resolv USR Stablecoin Exploit
kpk said it shielded depositors fully from a $23 million exploit of Resolv’s USR stablecoin by setting risk tolerance to zero and blocking new allocations to affected yield vaults. The project recovered all Ethereum funds from limited RLP exposure on Morpho and resumed deposits after automating tighter security triggers.
1. Exploit Mechanics
An attacker minted approximately 80 million USR tokens with under $200,000 in collateral, swapped them for staked versions and then converted to USDC, extracting roughly $23 million as Resolv’s stablecoin price plunged from $1 to $0.20.
2. kpk’s Immediate Response
Upon detecting risk, kpk set risk tolerance to zero on affected markets, blocked new allocations to its Morpho yield vaults and relied on its withdrawal queue to allow investors to exit without manual intervention.
3. Fund Recovery and Resumption
All Ethereum funds tied to the vaults were fully recovered, leading kpk to reopen deposits into its Ethereum yield vault once liquidity normalized.
4. Enhanced Safety Measures
kpk has implemented faster automation triggers, integrated advanced security alerting services and established new emergency response protocols to bolster defenses against future exploits.