Aave Seeks Court Relief for Frozen ETH Amid Kelp DAO Exploit Fallout

Severity: High (Score: 60.9)

Sources: Thedefiant, Bitget

Summary

Aave LLC filed an emergency motion on May 4, 2026, in the Southern District of New York to vacate a restraining notice affecting approximately $71 million in Ethereum (ETH) linked to the Kelp DAO bridge exploit that occurred on April 18. The restraining notice, served by Gerstein Harrow LLP on May 1, aims to block the transfer of the funds to satisfy unpaid judgments against North Korea. Aave argues that the funds should be returned to the affected users rather than being redirected to judgment creditors, asserting that stolen property does not become the property of a thief. The motion also criticizes the plaintiffs for relying on unsubstantiated claims connecting the exploit to North Korea's Lazarus Group. The Arbitrum Security Council had previously frozen 30,765 ETH on April 21 to facilitate recovery efforts for users impacted by the exploit. Aave's filing emphasizes the urgency of releasing the funds to prevent further harm to users and the DeFi community. The court has yet to rule on the motion. Key Points: • Aave filed an emergency motion to vacate a restraining notice on $71 million in frozen ETH. • The restraining notice aims to satisfy unpaid judgments against North Korea linked to the Kelp DAO exploit. • Aave argues that the funds belong to affected users, not to judgment creditors.

Key Entities

• Lazarus Group (apt_group)
• Aave DAO (company)
• Aave LLC (company)
• Arbitrum DAO (company)
• Arbitrum Security Council (company)
• DeFi United (company)
• Mantle (platform)
• Solana (platform)
• Iran (country)
• North Korea (country)