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Aave launches binding Arbitrum vote to move $71 million in disputed ETH
Arbitrum delegates begin the binding governance process to transfer disputed exploit funds to Aave, while North Korean terrorism creditors continue fighting for ownership in Manhattan court
May 12, 2026, 6:35 a.m. 2 min read
What to know:
- Aave and other parties affected by last month’s Kelp DAO hack have proposed a binding Arbitrum governance vote to transfer $71 million in disputed ether into Aave LLC’s custody.
- The amended Constitutional Arbitrum Improvement Proposal would move 30,765 ETH from an Arbitrum Security Council wallet to an Aave-controlled address in compliance with a recent court order tied to North Korean terrorism claims.
- The case pits DeFi users against U.S. terrorism judgment creditors, who argue the funds are North Korean property that could satisfy $877 million in unpaid awards, with voting on the proposal set to begin May 15.
If approved, the proposal would move 30,765 ETH from the wallet where Arbitrum’s Security Council immobilized the funds to an Aave LLC-controlled address, as required by the court’s order. However, the assets would remain subject to strict legal restrictions and cannot be freely used, transferred, or deployed by Aave LLC unless permitted by the court.
The legal fight over the frozen assets took an unusual turn after blockchain forensics firms widely attributed the exploit to North Korea’s Lazarus Group. That attribution comes from blockchain analytics firms and external forensic research, and has not been established as a legal finding within either the Arbitrum governance process or the ongoing court proceedings.
