Federal Judge Clears $71M in Arbitrum ETH for Aave Transfer, But Restraining Order Remains

According to a federal judge on Friday, May 9, Arbitrum's 30,766 ETH (approximately $71 million) has been cleared for transfer to Aave following a court order from Judge Margaret Garnett of the U.S. District Court for the Southern District of New York. The modification allows an onchain governance vote to move the frozen ether to Aave's wallet, and participants in that vote shall not violate the restraining notice.

However, the funds remain legally encumbered. Aave has agreed to be bound by the restraining order as if it had been served directly, meaning the assets are not free and clear once they land in Aave's wallet. If the court ultimately sides with North Korea terrorism creditors pursuing the claim, Aave could be compelled to surrender the ETH. Arbitrum delegates voted Thursday to approve the release, with 182.2 million ARB tokens and approximately 91% of voting power in favor.