Arbitrum Committee Advances Proposal to Unfreeze $71 Million in ETH

The Arbitrum governance committee has initiated a constitutional proposal to unfreeze approximately 30,765 ETH, worth about $71 million, which was previously frozen due to the Kelp DAO security incident. The proposal is currently entering the governance voting process for formal approval.

According to an emergency action notice released by the Arbitrum Security Committee on April 21, 30,765.6675 ETH related to the Kelp DAO exploit was transferred to a frozen address "0x…DA0". This batch of funds corresponds to a significant shortfall of approximately 76,000 rsETH assets and nearly $290 million in losses from the incident. The proposal is positioned as a necessary funding pool to limit further losses and restore protocol stability. The governance proposal has not disclosed specific compensation or distribution paths, only clarifying that the funds will be used to restore liquidity and solvency for Kelp DAO and related DeFi markets.

Currently, on-chain funds have transitioned from the "security emergency custody" phase to the "DAO voting redistribution" phase, effectively shifting control from a small multi-signature of the security committee to a joint decision-making process involving ARBITRUM governance token holders and related DeFi protocols (including Aave, Compound, and the "DeFi United" alliance). The positions held by the attackers face systematic liquidation, and the released ETH is expected to be gradually converted into rsETH and injected into the shortfall contracts. The actual funding purchases will come from alliance staking and treasury resources, while the pressured parties will be the liquidated attack wallets and the relevant protocol treasuries bearing the discounted repair costs.

Source: Public Information