Kraken is moving its wrapped bitcoin system from LayerZero to Chainlink, giving a boost to Chainlink’s Cross-Chain Interoperability Protocol (CCIP) as worries about bridge security grow in the crypto industry.
Kraken confirmed that its Kraken Wrapped Bitcoin (kBTC) will now use Chainlink’s CCIP system instead of LayerZero. Kraken said it made the change to get stronger security and better risk management tools.
This change comes soon after the large Kelp DAO hack, where attackers reportedly stole about $292 million due to problems with a LayerZero-powered bridge. Some security experts said the hack showed weaknesses in systems that use only one verifier.
Kraken is now at least the fourth major crypto project to cut back or stop using LayerZero after the incident. Other projects doing the same include Kelp DAO, Solv Protocol, and the on-chain reinsurance platform Re.
According to Chainlink representatives, the combined value locked from these migrating projects exceeds $2.5 billion. Kraken’s kBTC product alone reportedly holds more than $330 million in total value locked.
Chainlink’s CCIP system uses 16 independent node operators to check cross-chain transactions, which Kraken says gives better protection against attacks. The protocol also has built-in transaction limits and compliance certifications like ISO 27001 and SOC 2 Type 2.
The wider crypto community has been watching the effects of the Kelp DAO incident, especially after reports said many LayerZero apps used simple verification models. LayerZero has since admitted to communication problems and announced upgrades, including plans to stop supporting some high-risk setups.
For Chainlink, this wave of migrations is becoming a big growth story. Company representatives said over $3 billion in value has recently moved to Chainlink-powered systems as projects focus more on security after recent bridge attacks.
This trend also shows that as more institutions get involved, crypto companies are choosing infrastructure providers that meet higher security and operational standards.
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