Arbitrum Responds Swiftly to Kelp DAO Exploit, Freezing $71 Million in Ethereum

Arbitrum has frozen over $71 million in Ethereum after a significant exploit hit Kelp DAO on April 18, 2026. The action was taken to safeguard users' funds and minimize additional risks following the largest DeFi exploit of the year.

The incident involved a cross-chain bridge powered by LayerZero technology, which lost approximately 292 million rsETH tokens. Arbitrum's Security Council detected suspicious activity on its network shortly after the attack and promptly froze funds linked to the exploit, ensuring no other users or applications were affected.

Arbitrum collaborated with law enforcement in the response process, collecting information about the exploiter's identity and activities while prioritizing network security. A technical approach was employed to transfer the funds securely to a middle-man wallet that was frozen, rendering the exploiter inaccessible.