Arbitrum's Security Council Freezes $71M in KelpDAO Exploit

Arbitrum's recent intervention in the KelpDAO exploit has raised questions about the balance between decentralization and security in DeFi protocols.

The Security Council's decision to freeze 30,766 ETH worth $71 million marked a rare instance of protocol-level action in preventing further losses. The funds were moved to an intermediary wallet, limiting access for the exploiter.

This move contrasts with previous instances where stolen funds rarely returned due to lack of cooperation or intervention. In cases like Euler Finance and Curve Finance, partial recoveries relied on negotiations with attackers rather than protocol-level action.