Summary
- A U.S. federal court has allowed Aave to transfer $71 million in cryptocurrency that had been frozen in connection with a North Korea-linked hacking case.
- Aave would be able to move the frozen funds through a governance vote within the Arbitrum (ARB) network operating system.
- Aave argued that the funds were not North Korean assets but assets belonging to users harmed by the hack, and it is now awaiting a final approval vote from Arbitrum operators to complete the recovery process.
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A U.S. federal court has allowed Aave to transfer about $71 million in frozen cryptocurrency tied to a North Korea-linked hacking case.
CoinDesk reported on May 9 that U.S. District Judge Margaret Garnett in Manhattan partially modified a freezing order covering hacked funds on the Arbitrum network. The ruling would allow Aave to move the frozen assets through a governance vote within Arbitrum's operating system.
The funds are tied to the KelpDAO hack in April. Hackers attacked KelpDAO, minted large amounts of rsETH without authorization and then used the tokens as collateral on Aave to borrow Ether, according to the report.
Investigators later found signs linking the attack to Lazarus, the North Korean hacking group. Some of the stolen Ether was traced to wallets associated with Lazarus, while Aave's own report identified the attacker as a North Korea-linked hacker.
Relatives of terrorism victims who had already won a judgment against North Korea sought to seize the funds. They argued that because Lazarus operates under the control of the North Korean government, the hacked assets should be treated as North Korean property and used to satisfy damages.
Aave, by contrast, argued that the funds were not North Korean assets but belonged to users harmed in the hack. It is now awaiting a final approval vote from Arbitrum operators to complete the asset recovery process.
Uk Jin
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