Solv Protocol has announced the migration of its $700 million tokenized Bitcoin portfolio from the LayerZero platform to Chainlink’s Cross-Chain Interoperability Protocol (CCIP). This move comes in the wake of a high-profile exploit targeting KelpDAO, making Solv the second major platform to leave LayerZero in just days. Solv Protocol, a decentralized finance (DeFi) platform active on several blockchains, is known for its asset management and tokenization services.
Wave of departures from LayerZero intensifies
The decision by Solv Protocol closely follows KelpDAO’s switch from LayerZero to Chainlink CCIP for its cross-chain bridge system, made just two days prior. KelpDAO had suffered an attack last month resulting in nearly $292 million in losses, and attributed the vulnerability to LayerZero’s bridge architecture. The company further shared screenshots of conversations with the LayerZero team, arguing there was no explicit objection to their chosen design.
Bryan Pellegrino, founder of LayerZero, rejected these accusations, stating they were untrue. Despite this, the platform has not been able to stop prominent protocols from departing in the aftermath.
Protocol migration and underlying reasons
According to statements from KelpDAO, the use of a “1/1 validator” model—meaning single-signature approvals—posed greater risks compared to a multi-validator approach, raising the potential for attacks. Following the incident, KelpDAO eliminated this configuration and began moving to more stringent security standards. Data from DefiLlama shows that Solv Protocol now manages over $611 million in total value locked (TVL) across Bitcoin, Ethereum, and other blockchains.
Solv has now announced that it will end support for LayerZero bridges and adopt CCIP as the standard for all connected networks. Will Wang, Solv’s CTO, highlighted this shift in the company’s announcement, emphasizing the role of robust security measures:
“Security is the core of everything we build at Solv, and our migration to Chainlink CCIP represents our highest commitment to that principle,” Will Wang stated.
Johann Eid, Director of Business Development at Chainlink Labs, commented that Solv’s transition reflects a broader trend of leading DeFi protocols adopting Chainlink’s solutions to meet heightened security requirements across the industry.
Technical edge of CCIP and market impact
Chainlink’s CCIP framework operates three independent oracle networks for every cross-chain route. This tripartite structure ensures that even if one path is breached, attackers do not gain access to the others. Additionally, the risk management network is handled by a separate team and uses a different programming language, creating another protective layer.
Since launching, there have been no reported value losses involving CCIP. In comparison, LayerZero’s recent exploitation was followed by major platforms like Aave suffering a combined TVL drop of $13 billion and accumulating $177 million in bad debt.
To compensate users affected by the breach, LayerZero pledged 10,000 ETH to the DeFi United recovery fund. Although the Arbitrum Security Council froze 30,766 ETH in attacker wallets, ongoing legal uncertainties in the US cloud the final status of these assets. Meanwhile, Aave has initiated legal proceedings to seek the release of blocked funds.
Following KelpDAO’s allegations, LayerZero’s reputation has taken another hit. The consecutive withdrawals of two high-volume protocols have raised fresh concerns about the platform’s future stability and standing in the DeFi sector.
LayerZero, according to DefiLlama, has generated $197,000 in protocol fees over the past 30 days. Its native token is currently trading at $1.48, marking a 1.6 percent decrease in the last 24 hours.
