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The Arbitrum DAO is voting to release 30,766 ETH that were frozen by the Arbitrum Security Council for the DeFi United initiative, which was formed after the Kelp DAO attack earlier this month.
In the first hour of voting, 16.9 million ARB tokens were cast in favor of the proposal, with no votes reported against it. The vote is scheduled to run until May 7.
On April 20, the Arbitrum Security Council froze approximately $71.1 million worth of ETH that the Kelp DAO attacker had moved to an Arbitrum One address. The funds were moved to 0x0000000000000000000000000000000000000DA0 and would require a governance action to be released.
“The Security Council acted with input from law enforcement as to the exploiter's identity, and, at all times, weighed its commitment to the security and integrity of the Arbitrum community without impacting any Arbitrum users or applications,” the council said at the time.
In the days leading up to the freeze, attackers—now suspected to be associated with the North Korean hacking collective Lazarus Group—exploited a cross-chain communication channel used by Kelp DAO. The attack drained $292 million worth of the protocol’s version of staked ETH, representing about 18% of rsETH’s circulating supply.
The assets were moved to lending protocols including Aave, Compound, and Euler. They were then used as collateral to borrow large amounts of WETH and other assets, creating about $236 million in debt positions.
Several protocols, including Kelp and Aave, paused contracts or markets in response to the attack. The Arbitrum Security Council, elected by the DAO, also used its emergency powers, with 9-of-12 approvals, to freeze the Arbitrum One address used by the attacker.
Some observers criticized the move, citing concerns about centralized power and the lack of onchain immutability. Others defended the council’s action based on its mandate to serve the Arbitrum ecosystem.
The Aave-led DeFi United initiative was created to raise funds and restore rsETH’s backing. As of Thursday, contributors have donated or loaned over $311 million worth of ETH and stablecoins.
If approved, Arbitrum DAO would contribute the largest sum to the initiative to date. The next-largest contributions referenced were Consensys and Joseph Lubin’s combined 30,000 ETH contribution, followed by Mantle’s 30,000 ETH loan.
Aave DAO also has a pending vote to release 25,000 ETH, adding to Stani Kulechov’s 5,000 ETH. LayerZero contributed 5,000 ETH to DeFi United and will deploy an additional 5,000 ETH on AAVE, which will accrue interest. Kelp contributed 2,000 ETH.
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