🚨 Aave Seeks to Unfreeze $71M in Frozen Crypto from Kelp DAO Hack
A federal court case has been filed involving Aave’s attempt to unfreeze $71 million in assets on Arbitrum, tied to the Kelp DAO hack. The outcome could set a precedent on whether DeFi recovery funds are subject to seizure for unrelated judgments, according to court filings.
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Aave-affiliated Aave LLC moved to block a court order to seize approximately $71 million worth of ETH from the Arbitrum DAO.
The funds are being secured to compensate exploit victims, highlighting the clash between "governance funds" and "legal authority" in DeFi. https://t.co/1Q3aCE8Zrv
aave: yo arbitrum, send back the $71m you get from the hacker, we need it
arbitrum: chill, we’re voting on it, you’ll have it in a few days. defi united, remember?
aave: bet. love that for us
(suddenly, american lawyers show up)
plaintiffs: stop right there. that $71m is ours now
aave: excuse me??
plaintiffs: we have old judgments against north korea. the hacker was lazarus group. lazarus is north korea. therefore the funds belong to north korea. therefore we seize them
aave: wait. do you have proof it was north korea?
plaintiffs: yeah, tweets
aave: …tweets
plaintiffs: and a news article
aave: but even if it was them, holding stolen funds for 5 minutes doesn’t make you the owner??
plaintiffs: yes it does
aave: so if i smash a tiffany’s window, grab a diamond, and a bystander grabs it back from me, your creditor friends can seize the diamond?
plaintiffs: correct
arbitrum: uhh… what are we supposed to do here
plaintiffs: don’t move. everything’s frozen
aave: but the funds belong to my innocent u
