TechFlow News, May 5: According to a Cointelegraph report, the DeFi protocol Aave filed an emergency motion in New York on Monday seeking to vacate a restraining notice issued by U.S. law firm Gerstein Harrow LLP that blocks the Arbitrum DAO from transferring 30,766 ETH to victims of the Kelp vulnerability.
Gerstein Harrow LLP served the restraining notice on the Arbitrum DAO last Friday, asserting that its client is entitled to over $877 million in damages under a default judgment against North Korea. The law firm claimed that the North Korean hacking group behind the Kelp vulnerability—discovered on April 18—previously held these tokens and thus its client holds a legal claim to the relevant ETH.
In its motion, Aave countered that thieves do not acquire lawful ownership of property through theft; that North Korea’s involvement remains purely “speculative”; and that the law firm’s arguments are “illogical, contrary to common sense, and legally unsound.” Aave’s attorneys warned that any delay would cause “irreparable harm” to the protocol, its users, and the broader DeFi community—and could incentivize malicious actors to launch further attacks against additional crypto protocols.
The Arbitrum DAO is currently voting on whether to release the aforementioned ETH to support DeFi United—a cross-industry coordination initiative established to provide relief to rsETH holders and assist in restoring rsETH collateral following the $292 million hack targeting Kelp DAO on April 18. The vote will conclude on May 7. Should the court fail to immediately vacate the restraining order, Aave’s attorneys have requested that Gerstein Harrow post a $300 million bond to maintain the restraint pending final judgment. The judge has not yet ruled on the emergency motion, and no hearing date has been scheduled.
