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6d ago

Judge Clears Path for $71 Million Arbitrum ETH as rsETH Recovery Push Advances

The next step requires a binding on-chain vote followed by a multi-day withdrawal wait.

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Aave completes liquidation of kelp dao attacker’s final rseth positions
Judge clears $71m eth transfer to aave as rseth recovery enters final phase
Court lets arbitrum dao to transfer $71m in eth tied to north korea hack to aave

Overview

  • Aave, which finished liquidating the exploiter’s rsETH-backed positions on Wednesday, moved the recovered collateral into the DeFi United Recovery Guardian multisig wallet and said user funds were not affected.
  • Arbitrum delegates backed releasing 30,765 ETH in a non-binding Snapshot vote that closed Friday, and any transfer still needs a formal on-chain Constitutional proposal plus the network’s standard roughly eight-day withdrawal delay.
  • A Manhattan federal judge modified a restraining notice so the frozen ETH can be routed to the recovery wallet, with the plaintiffs’ legal claims preserved as the assets move.
  • DeFi United’s recapitalization pool is still about 10% short of the ether needed to fully restore rsETH backing, with additional commitments sought from Circle, Ethena, Frax, and Kraken-backed Ink.
  • The April 18 breach exploited Kelp DAO’s LayerZero-linked bridge set to a single verifier, which let attackers mint about 116,500 unbacked rsETH and post it as collateral to borrow ETH, leaving Aave with over $190 million in bad debt.