Arbitrum DAO Votes on $71M Transfer to DeFi United Recovery Fund

Arbitrum Poised to Become DeFi United's Largest Contributor

The Arbitrum DAO has initiated a governance vote on transferring 30,766 ETH — approximately $71 million — to DeFi United, the recovery fund established in the wake of the Kelp protocol exploit. The discussion period runs through May 7.

At the time of publication, 34 million ARB tokens had already been cast in favor of the proposal. The Arbitrum Security Council had previously frozen the attacker's funds and moved them to an intermediary wallet. Should the vote pass, Arbitrum DAO would become the single largest donor to the DeFi United initiative.

Why This Matters

The Security Council's decision to manually freeze the hacker's assets has split the Arbitrum community. Some members criticized the very possibility of manual intervention in the network state, viewing it as a threat to decentralization principles. Others considered the action justified given the scale of the damage.

The debate touches on a fundamental governance question for L2 networks: whether centralized intervention is acceptable to protect user funds, and where the line between security and censorship should be drawn.

DeFi United Fund Surpasses $314 Million

As of May 1, DeFi United had raised more than $314 million — enough to fully cover the $290 million in losses from the Kelp hack.

Key contributors to the fund include:

• ConsenSys and Joseph Lubin — jointly committed 30,000 ETH;
• Mantle — provided a loan of 30,000 ETH;
• Aave DAO — considering a transfer of 25,000 ETH, with an additional 5,000 ETH pledged by protocol founder Stani Kulechov;
• LayerZero— contributed 5,000 ETH and deposited another 5,000 ETH into Aave;
• Kelp — contributed 2,000 ETH.

April Sets Record for Crypto Exploits

April 2026 turned out to be one of the most devastating months for the crypto industry in terms of cybersecurity. According to CertiK, total losses reached $651 million — the highest figure since March 2022, when the sector lost $715 million.

The bulk of the damage came from two major incidents: the Drift protocol lost $285 million early in the month, followed by the Kelp exploit. Additionally, on April 30, the Wasabi protocol was attacked, with hackers draining more than $5 million.

The Arbitrum DAO vote continues until May 7. Its outcome will determine whether DeFi United receives what would be the largest single contribution to the recovery fund to date.