U.S. Judge Signs Off on Aave Plan to Move $71M in Frozen ETH Tied to Alleged North Korea Hack

A U.S. federal judge has approved Aave's asset recovery plan following the rsETH exploit, clearing the way for roughly $71 million in ETH that had been frozen on Arbitrum to be transferred to Aave-controlled wallets. In an order dated May 9, U.S. District Judge Margaret Garnett of the Southern District of New York modified an earlier restraining order involving the Arbitrum DAO. Court filings show the change allows the Arbitrum community to execute the transfer through an onchain governance vote and provides legal protection for participants involved in the voting and transfer process. The frozen funds are linked to the April rsETH attack, which has been widely attributed to the Lazarus Group, an entity associated with North Korea. Prior to the ruling, lawyers representing families of victims of North Korean terrorism sought to keep the assets frozen and pursue them as part of about $877 million in outstanding judgments. Arbitrum community sentiment has already leaned toward returning the ETH to support Aave's recovery plan, based on a Snapshot poll. The transfer still requires formal onchain governance approval. The matter sits within a broader push by U.S.-based plaintiffs to recover crypto assets tied to North Korea. Plaintiffs have also filed suit against the privacy protocol Railgun DAO and named Digital Currency Group (DCG) as a defendant, alleging involvement in related governance and economic activities.