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US Court Approves Aave's Transfer of $71 Million ETH Related to North Korean Hacking Incident

On May 9, U.S. District Judge Margaret Garnett in Manhattan approved Aave's asset recovery plan following the rsETH hacking incident, allowing approximately $71 million in ETH that had previously been frozen on Arbitrum to be transferred to a wallet controlled by Aave. Court documents indicate that this decision modifies a prior injunction against the Arbitrum DAO, permitting the community to complete the ETH transfer through on-chain governance voting, while exempting those participating in the vote and executing the transfer from legal liability. This incident stems from the rsETH hacking event that occurred in April, which has been widely attributed to the Lazarus Group, linked to North Korea. Previously, lawyers representing victims of North Korean terrorism had sought to freeze the related assets and attempted to include them in the compensation for an outstanding judgment of approximately $877 million. The Arbitrum community has expressed strong support in a Snapshot temperature check vote for returning the frozen ETH to Aave's recovery plan, but the actual transfer still requires formal approval through on-chain governance. Reports indicate that this case is also part of the U.S. plaintiffs' efforts to reclaim cryptocurrency assets associated with North Korea. In addition to Arbitrum, the plaintiffs have previously sued the privacy protocol Railgun DAO and named Digital Currency Group (DCG) as one of the defendants, accusing it of involvement in related governance and economic activities.

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