ChainThink report, May 15: According to Foresight News, Kelp DAO's cross-chain bridge was attacked by North Korea’s Lazarus Group on April 18, resulting in losses of approximately $292 million. The Arbitrum Security Council has frozen 30,766 ETH belonging to the attackers, valued at around $71 million.

Four weeks after the theft, rsETH withdrawal functionality was restored; however, the frozen ETH became embroiled in a dispute over ownership due to its connection to a U.S. federal lawsuit related to North Korean terrorism compensation.

U.S. District Judge Margaret Garnett from the Southern District of New York has intervened twice in this dispute. On May 9, she modified the injunction to permit Arbitrum DAO to transfer the frozen ETH into an Aave-controlled wallet via on-chain governance voting;

On May 14, the judge postponed the scheduled emergency hearing to June 5 and instructed Aave and Gerstein Harrow, law firm representing families of anti-terrorism victims, to submit additional legal documentation by May 22.

Gerstein Harrow represents three groups of families holding unenforced anti-terrorism judgments against North Korea, arguing that the ETH constitutes North Korean state assets and should be used for compensating terrorism victims;

On-chain investigator ZachXBT and security researcher Taylor Monahan criticized the move, asserting that Aave users are the actual victims of this attack, and that legal intervention will delay the recovery process.

Aave initiated an on-chain vote on May 12 to transfer 30,765 ETH into the Aave Recovery Guardian multisig wallet, with voting expected to last approximately eight days;

Kelp DAO has resumed rsETH withdrawals, cross-chain bridging, and EigenLayer staking functionalities. The forged rsETH supply created by the attacker was fully liquidated and destroyed by May 7.

Additionally, Aave Labs is proposing a restructuring of its bug bounty program, with the maximum reward for critical vulnerabilities in core Aave V3 increased to $5 million. The final disposition of the $71 million in ETH remains pending the outcome of the U.S. federal court hearing scheduled for June 5.