Aave: Court authorizes freezing of ETH transfers; rsETH compensation inquiry tool goes live

According to an official announcement by Aave posted on X on May 9, the launch of Phase 2 of the rsETH incident recovery plan has been declared; the court has issued an order authorizing the transfer of the $71 million worth of ETH recovered by the Arbitrum Security Committee to Aave LLC. The compensation inquiry tool is now officially live, and users affected by the rsETH incident can look up their expected compensation amounts.

Completed steps: liquidation, governance proposals, and AIP execution

Per an official Aave announcement, on May 6, 2026, the attacker completed the liquidation of eight identified positions on Aave V3 Ethereum Core and Arbitrum. The recovered rsETH collateral has been transferred to the Recovery Guardian in accordance with the AIP rules previously approved by the Aave DAO; other users (including Umbrella stakers) are not affected by this process.

On the governance side, the Aave official announcement states that Mantle DAO confirmed that its proposal to participate in DeFi United was approved by an overwhelming majority. The Arbitrum DAO proposal also reached quorum and received overwhelming support. The proposal aims to return the $71 million worth of ETH that the Arbitrum Security Committee recovered from the attacker to Aave protocol users for the joint recovery actions of DeFi United.

Legal progress: court authorization to freeze ETH transfers to Aave LLC

According to an official Aave announcement, on May 1, 2026, the plaintiff holding a North Korea-related judgment served a restraining order to the Arbitrum DAO, attempting to stop the transfer of the $71 million worth of ETH recovered by DeFi United from circulating. Aave LLC subsequently filed an emergency motion to revoke the restraining order, and the court held a hearing on May 6, 2026.

The Aave announcement states that the judge issued an order authorizing, via an on-chain Arbitrum DAO vote, the transfer of the frozen ETH to Aave LLC. The restraining order will be transferred and attached under Aave LLC’s name. Aave LLC is currently awaiting the final ruling. Aave said that as an interim measure, the team has borrowed additional funds to cover the shortfall, ensuring that users are not affected by delays before the frozen ETH is legally returned.

Next-phase plan: elimination of rsETH over-issuance and market restoration

According to the official Aave announcement, the core steps of Phase 2 of the recovery plan are as follows:

Arbitrum: The rsETH obtained from liquidation will be destroyed; KelpDAO will synchronously destroy the corresponding LayerZero cross-chain message packets to prevent the receiving side from minting new rsETH, fully eliminating the rsETH supply inflation caused by the incident

Ethereum: The confiscated rsETH will be moved to the bridge lockbox, and will be topped up together with the ETH pledged by the DeFi United alliance to back the lockbox. After the backing is completed, the bridge will resume normal operations and rsETH withdrawals will reopen

Protocol parameters: Parameters temporarily adjusted by Aave V3 for liquidation will be rolled back, and remaining impacted positions will be closed out in ETH form

WETH LTV: The WETH LTV parameter on Aave V3 Ethereum Core will soon be restored to normal levels

Aave said the rsETH incident compensation inquiry tool is now online, and affected users can go to check their expected compensation amounts.

FAQ

What are the release time and source for the Phase 2 announcement of the Aave rsETH incident recovery plan?

According to an official announcement by Aave posted on X on May 9, 2026, this update is the Phase 2 announcement of the rsETH incident technical recovery plan. The original V3 technical recovery plan was released on April 28, 2026.

What exactly did the court’s order regarding the freezing of ETH transfers say?

According to the official Aave announcement, after a hearing on May 6, 2026, the judge issued an order authorizing that the frozen $71 million worth of ETH be transferred to Aave LLC via an on-chain Arbitrum DAO vote. The restraining order will be transferred and attached under Aave LLC’s name; Aave LLC is currently awaiting the final ruling.

How can users affected by the rsETH incident use the compensation inquiry tool?

According to Aave’s official announcement on May 9, 2026, the compensation inquiry tool is now officially live. Users affected by the rsETH incident can go to check their expected compensation amounts; the specific entry point and compensation calculation rules are detailed on the Aave official announcement page.