Arbitrum DAO is moving closer to releasing nearly $71 million worth of frozen Ether connected to the Kelp DAO exploit after receiving overwhelming support from voters.
According to governance results, more than 90% of voting power backed the proposal, with around 173.9 million ARB tokens voting in favor. Very few votes opposed it.
What happened?
After the Kelp DAO exploit in April, around 30,765 ETH was moved onto the Arbitrum network by the attacker.
Arbitrum’s Security Council later froze those funds with support from law enforcement, placing the ETH into a controlled wallet without disrupting the network.
At current prices, the frozen assets are worth about $71 million.
What the proposal would do
The recovery plan would move the frozen ETH into a multisig wallet managed by:
- Aave Labs
- Kelp DAO
- Certora
- EtherFi
The wallet would use a 3-of-4 approval structure through a Gnosis Safe setup.
This proposal is part of a wider recovery effort called “DeFi United,” involving several major crypto protocols working together to limit damage from the exploit.
But there’s still a problem
Even if the ETH is released, the recovery is still far from complete.
The exploit itself reportedly drained nearly $292 million, leaving a major gap still uncovered after the frozen funds are returned.
Several crypto organizations have pledged additional ETH to help stabilize the system, but the shortfall remains large.
Legal pressure is also growing
At the same time, U.S. court filings have complicated the situation.
Lawyers representing victims connected to North Korea-related terrorism cases argue the frozen ETH may legally count as North Korean-linked property because investigators connected the exploit to the Lazarus Group.
That has created competing claims over who should ultimately control the funds.
Bigger picture
The incident has become more than just a hack recovery.
It now touches:
- DeFi governance
- legal ownership of hacked crypto
- North Korea-linked cybercrime
- and how decentralized protocols respond during crises
In simple terms
Arbitrum voters strongly support releasing the frozen ETH to help recover losses from the Kelp DAO exploit — but legal battles and a huge remaining financial gap mean the situation is still far from resolved.
