ether.fi responds to its decision to donate 5,000 ETH to the Kelp compensation fund: due to concerns about a systemic collapse in DeFi caused by a hacking incident.

In a post on the X platform, ether.fi CEO Mike Silagadze responded to questions about his commitment to donate 5,000 ETH to the Kelp hack recovery fund. He stated that the team believes the incident posed a real risk of "destroying the entire DeFi ecosystem." If Kelp were to go bankrupt, $1.5 billion worth of rsETH could be frozen indefinitely, potentially bringing the $30 billion Aave lending market to a standstill and triggering a chain reaction of collapses in DeFi and CeFi. He added that "FTX pales in comparison." Silagadze further stated that taking responsibility and quickly raising funds to patch the vulnerability, while most institutions chose to back down and leave it to lawyers, was the best option to help avoid the worst-case scenario.