The Security Council on Arbitrum froze 30,766 ETH, an amount equivalent to approximately $71 million, on Monday night, freeing it from addresses linked to the rsETH attack recently supported by KelpDAO. This amount constitutes a significant portion of the money seized in the attack; It became possible to move the remaining funds only with an additional decision of the Arbitrum community management. This important decision was taken after information was received from the competent authorities regarding the identity of the person who carried out the attack. The Security Council also stated that no Arbitrum users or applications were affected when taking this step.
Details of the attack and assets recovered
On Saturday, April 20, 116,500 rsETH was stolen in the attack on KelpDAO’s LayerZero infrastructure bridge. rsETH is a liquid token issued by KelpDAO that represents users’ staked ether position. The attackers obtained the assets in question by taking advantage of the vulnerability of the authenticator infrastructure on the bridge. Initial analyzes made immediately after the incident suggested that the North Korea-based Lazarus Group might be behind the attack. KelpDAO operates in the field of restaking in the Ethereum ecosystem and frequently emphasizes that it attaches importance to security within the decentralized structure of the ecosystem.
The amount of ETH recovered through the intervention of the Arbitrum Security Council corresponds to approximately a quarter of the total amount stolen. Arbitrum, on the other hand, is known as a second layer blockchain on the main Ethereum chain that reduces transaction fees and offers fast confirmations. Security Council; It consists of people selected to protect user funds in case of emergency, but direct intervention into user assets is considered a highly controversial practice.
How is the process progressing and new areas of discussion?
Following the freezing decision, the stolen funds are now out of the attacker’s direct access. The remaining assets are still scattered on the chain. The next steps seem to depend on how much funds the attacker has moved to other blockchains or derivative assets and whether the relevant blockchains will make similar interference.
The immediate intervention of the Arbitrum Council also brought the liability debate between KelpDAO and LayerZero to a new stage. How to share losses among the community after the attack; It remains unclear how insurance, contribution from the treasury or legal solutions will work. The frozen fund of $71 million stands out as an important balance point in terms of damages that can be compensated in this process. So far, no official statement has been made by LayerZero on the subject.
The Security Council emphasized that the action was taken in line with information from law enforcement authorities and that this process did not affect any users or applications on Arbitrum.
Recovery fund prospect and community moves
KelpDAO said that it was working on a recovery fund with its ecosystem partners after the attack and that they were evaluating various options to cover the losses of damaged users. In addition to freezing the transactions, plans are also being made about restarting the process, sharing losses and legal steps.
According to experts, whether the rsETH tokens remaining in the attacker’s possession are transferred to other chains and emergency interventions in a decentralized structure will determine the course of the process. It will be clear in the coming days whether management bodies in other chains will take a similar step.
When viewed as a whole, both the necessity of such interventions in decentralized finance ecosystems and the concerns they bring have been brought to the agenda again.
