hodler

4 May 2026, 09:54

Us court freezes $73 million ETH linked to North Korea suit

🚨 US court blocks $73 million ETH transfer citing North Korean ties. Frozen funds stemmed from the Kelp DAO hack and legal disputes now limit their movement. Continue Reading: Us court freezes $73 million ETH linked to North Korea suit The post Us court freezes $73 million ETH linked to North Korea suit appeared first on COINTURK NEWS .

4 May 2026, 08:27

US law firm attempts to block transfer of frozen ETH from Kelp exploit

Gerstein Harrow has filed similar cases in the past, arguing its clients have a claim to funds stolen by the DPRK and frozen by crypto firms.

4 May 2026, 08:15

Arbitrum Frozen ETH: Lawsuit Seizes $73M in Stolen Funds After Kelp DAO Hack

BitcoinWorld Arbitrum Frozen ETH: Lawsuit Seizes $73M in Stolen Funds After Kelp DAO Hack A U.S. law firm has filed a lawsuit to seize $73 million in Ethereum (ETH) frozen by Arbitrum after the Kelp DAO hack. Gerstein Harrow LLP represents clients who won judgments against North Korea for past hacking incidents. The firm now claims ownership of the 30,766 ETH, which Arbitrum froze to protect victims. Arbitrum Frozen ETH: The Legal Battle Begins On April 18, Kelp DAO suffered a devastating $292 million hack. The Arbitrum Security Council acted quickly, freezing 30,766 ETH in an address linked to the hacker. This action aimed to prevent the stolen funds from moving or being laundered. Now, Gerstein Harrow LLP has filed a lawsuit in a New York court. The firm argues its clients have a rightful claim to the frozen funds. These clients won three separate lawsuits against North Korea for state-sponsored hacking attacks. The total value of those judgments exceeds $877 million. The court has reportedly approved a restraining and execution order. This order prohibits Arbitrum from moving the assets. It effectively freezes the frozen funds in place, pending a legal decision. Arbitrum had planned to transfer the 30,766 ETH to DeFi United. This is a relief fund for hacking victims. The funds would have compensated Kelp DAO users who lost money in the hack. The lawsuit now delays this recovery process. Understanding the Kelp DAO Hack and Its Aftermath Kelp DAO is a liquid staking protocol on Arbitrum. The hack exploited a vulnerability in its smart contract. Attackers drained $292 million in various cryptocurrencies. The Arbitrum Security Council intervened within hours. They identified the hacker’s address and froze the assets. This action is part of Arbitrum’s emergency powers under its governance framework. The frozen funds represent a significant portion of the stolen assets. However, the legal challenge now complicates their return. Victims of the hack face further delays in receiving compensation. Gerstein Harrow has filed similar lawsuits before. In one case, they targeted funds frozen after a Bybit hack. This pattern shows a growing trend of legal claims against frozen crypto assets. North Korea’s Role in Crypto Hacking North Korea is a known state sponsor of crypto hacking. The Lazarus Group, linked to the regime, has stolen billions of dollars. Past attacks include the 2014 Sony hack and the 2016 Bangladesh Bank heist. In recent years, North Korean hackers have targeted DeFi protocols. They use sophisticated methods to launder stolen funds. The U.S. government has imposed sanctions on North Korea for these activities. Gerstein Harrow’s clients won judgments against North Korea in U.S. courts. These judgments hold the regime liable for damages. The firm now seeks to enforce these judgments using frozen crypto assets. Arbitrum’s Position and the Impact on Victims Arbitrum has stated its opposition to the seizure action. The platform argues it delays the return of victims’ funds. They emphasize their commitment to protecting users and the ecosystem. The legal battle creates uncertainty for Kelp DAO users. Many expected a swift recovery of their lost funds. Now, they must wait for the court to decide the outcome. DeFi United, the relief fund, also faces delays. The fund relies on the frozen ETH to compensate victims. Without access, they cannot process claims or distribute payments. The case raises important questions about asset ownership in crypto. When a hacker steals funds, who has the right to claim them? Victims of the hack argue they are the rightful owners. Gerstein Harrow’s clients argue their judgments give them priority. Legal Precedents and Future Implications This lawsuit is not the first of its kind. Similar cases have emerged in the crypto space. Courts are increasingly asked to decide ownership of frozen assets. In 2023, a U.S. court ruled that victims of a hack could claim stolen funds. The ruling set a precedent for victim priority. However, cases involving state-sponsored hacking add complexity. Gerstein Harrow’s approach uses existing judgments to claim assets. This strategy could become more common. It allows victims of state-sponsored attacks to recover damages from any source. The outcome of this case could impact future hack responses. Exchanges and protocols may hesitate to freeze assets. They might fear legal challenges from third-party claimants. Timeline of Events: From Hack to Lawsuit April 18: Kelp DAO suffers a $292 million hack. The Arbitrum Security Council freezes 30,766 ETH. April 19: Arbitrum announces plans to transfer funds to DeFi United. The goal is to compensate victims. May 10: Gerstein Harrow LLP files a lawsuit in New York court. The firm claims ownership of the frozen ETH. May 15: Court approves a restraining and execution order. Arbitrum cannot move the assets. May 20: Arbitrum publicly opposes the seizure. The platform states it delays victim recovery. Key Entities Involved Gerstein Harrow LLP: U.S. law firm representing clients with judgments against North Korea. Arbitrum (ARB): Layer-2 scaling solution for Ethereum. The platform froze the stolen funds. Kelp DAO: Liquid staking protocol on Arbitrum. The victim of the $292 million hack. DeFi United: Relief fund for hacking victims. The intended recipient of the frozen ETH. North Korea: State sponsor of hacking. The target of the original judgments. Conclusion The lawsuit over Arbitrum frozen ETH highlights the complex legal landscape of crypto. Gerstein Harrow’s claim challenges the priority of hack victims. The outcome will set a precedent for future asset seizures. For now, the 30,766 ETH remains frozen, awaiting a court decision. Victims of the Kelp DAO hack face further delays. The case underscores the need for clear legal frameworks in decentralized finance. FAQs Q1: What is the lawsuit about? The lawsuit seeks to seize $73 million in ETH frozen by Arbitrum after the Kelp DAO hack. Gerstein Harrow LLP claims the funds for clients who won judgments against North Korea. Q2: Why did Arbitrum freeze the ETH? Arbitrum froze 30,766 ETH to prevent the hacker from moving or laundering the stolen funds. The action aimed to protect victims of the Kelp DAO hack. Q3: Who are Gerstein Harrow’s clients? They are victims of past North Korea hacking incidents. They won three separate lawsuits against the regime, totaling over $877 million in judgments. Q4: How does this affect Kelp DAO victims? The lawsuit delays the return of frozen funds to Kelp DAO victims. Arbitrum had planned to transfer the ETH to DeFi United for compensation. Q5: What is the legal precedent for this case? Similar cases have occurred in crypto, including a lawsuit over frozen funds after a Bybit hack. Courts are increasingly deciding ownership of frozen assets. Q6: What happens next? The court will decide whether Gerstein Harrow’s clients have a rightful claim to the frozen ETH. The decision could impact future hack responses and asset recovery. This post Arbitrum Frozen ETH: Lawsuit Seizes $73M in Stolen Funds After Kelp DAO Hack first appeared on BitcoinWorld .

3 May 2026, 21:04

North Korea-linked creditors target frozen Kelp DAO funds

Plaintiffs holding nearly $877 million in unpaid U.S. court judgments against North Korea are attempting to seize about 30,766 ether (roughly $71 million) frozen on the Arbitrum network in respect to the Kelp DAO exploit, setting up a legal clash between sanctions enforcement and decentralized finance governance. The effort follows a restraining notice authorized by a U.S. federal court in New York on April 30 and served to the Arbitrum DAO via its governance forum, according to reporting by The Block and forum records. The plaintiffs are not tied to the exploit involving Kelp DAO . Instead, they are long-standing creditors seeking to enforce terrorism-related judgments against Pyongyang. The legal action combines three separate U.S. court judgments tied to attacks attributed to or linked with North Korea. These include the killing of Reverend Kim Dong-shik, alleged support for Hezbollah during the 2006 Lebanon war, and the Lod Airport massacre. Together, the judgments exceed $877 million before interest and remain unpaid, according to court records. Crypto attribution creates a new enforcement path The case hinges on attribution of the underlying exploit. Blockchain firm LayerZero said the Kelp DAO-related breach was linked to the Lazarus Group, a unit long associated with state-backed cyber theft. In its incident analysis, LayerZero said the failure stemmed from system design, noting: “This means no single DVN should represent a unilateral point of trust or failure.” Separately, the company stated the incident was isolated, saying: “This incident was isolated to KelpDAO’s rsETH configuration.” U.S. authorities have previously tied the same hacking apparatus to broader campaigns. The Federal Bureau of Investigation said DPRK-linked actors were responsible for “high-profile international cryptocurrency heists.” Following the exploit, Arbitrum’s Security Council froze the funds after tracing them to addresses associated with the attacker, according to on-chain data and public disclosures. Kelp DAO governance vote collides with court order The legal action arrives as Arbitrum governance considers a proposal to transfer the frozen funds to a recovery initiative backed by Aave Labs, Kelp DAO, LayerZero, EtherFi, and Compound. The plan would compensate users affected by the exploit and stabilize Kelp DAO’s ecosystem, according to governance materials. However, the restraining notice bars any transfer while litigation proceeds, creating a direct conflict between decentralized governance and court authority. A test case for DeFi and sanctions enforcement The dispute highlights unresolved legal questions about how decentralized systems interact with traditional courts. At its core is a novel issue: whether crypto assets linked—through attribution—to a sanctioned state can be seized to satisfy long-standing terrorism judgments. For victims, blockchain traceability offers a rare enforcement opportunity. For DeFi protocols, the case raises the prospect that governance decisions could carry legal consequences beyond code. The Arbitrum vote is set to close May 7, while the restraining notice remains in effect pending further proceedings. Your bank is using your money. You’re getting the scraps. Watch our free video on becoming your own bank

3 May 2026, 18:30

Crypto Industry Under Siege: 29 Attacks Recorded In April 2026 Alone

The crypto industry is seriously under attack following a recent surge in exploit incidents. According to market analyst Ali Martinez , data from DeFiLlama shows that April was particularly bad for digital asset firms and protocols, with 29 attacks recorded, the highest ever in a single month. Without a doubt, these incidents have sparked concerns among crypto enthusiasts, leading to speculation about potential causes and solutions to this disturbing pattern. Notably, total attacks in April resulted in combined losses of $635 million. About 90% of these losses can be attributed to attacks on the Drift Protocol and KelpDAO. Drift Protocol, the largest Solana-based decentralized perpetual futures exchange, saw North Korean hackers drain $285 million by tricking the security council into unknowingly pre-signing transactions using a fictitious CarbonVote token. On the other hand, Kelp DAO , an Ethereum-based liquid staking protocol, lost $292 million in rsETH after attackers exploited the protocol’s LayerZeo-powered cross-chain bridge by manipulating the message layer to act on a nonexistent valid instruction. The impact of these attacks goes beyond immediate losses and also weakens crypto users’ confidence. For example, the total value locked (TVL) on DeFi platforms dropped by $13.5 billion following the 48 hours after the Kelp DAO attack. AI Evolution And Adoption Driving Crypto Attacks: Analysts According to Martinez, the strides recorded in global AI development now function as a double-edged sword. While there is greater potential for higher productivity owing to newer AI products, such as Anthropic’s Mythos models, these agentic AIs can also facilitate effective exploitation operations, minimizing the time required for reconnaissance and weaponization. The crypto industry is witnessing a big spike in security breaches. Data from DeFiLlama and industry reports confirm that April 2026 saw a record 29 hacks, the highest monthly incident count in history. Over $635 million was lost in April alone, primarily driven by the Drift… https://t.co/KpM59tXxdL pic.twitter.com/xrqIA5l3v5 — Ali Charts (@alicharts) May 2, 2026 The crypto pundit draws much attention to this developing negative use case, citing that a small volume of AI-assisted attacks by North Korean hackers accounted for 76% of the losses recorded in April. As AI development surges, Martinez warns that the crypto industry is at risk of a surge in security incidents, which could lead to higher market volatility. More data from DeFiLlama shows that total exploit losses in 2026 now stand at $723.39, representing a 57% decline from the figures reported in the same period in 2025. However, it’s worth noting that the $1.692 billion recorded in the 2025 first trimester is largely attributable to the $1.5 billion Bybit hack, i.e., the largest exploit in the crypto industry. Market Overview At press time, the total crypto market cap is $2.57 trillion, down 0.16% over the past day.

3 May 2026, 15:33

North Korea's Crypto Hack Playbook Won't Work on Canton Network, Says Digital Asset CEO

Because Canton allows participants to implement guardrails, Digital Asset's Yuval Rooz isn't afraid of North Korean-linked hacking groups.