Arbitrum Security Council Freezes $71M in ETH After KelpDAO Exploit, Reigniting Decentralization Debate

According to BlockBeats, on April 24 Arbitrum's Security Council froze more than 30,000 ETH (about $71 million) in the wake of the KelpDAO attack, blocking the transfer of part of the stolen assets and triggering a fresh dispute over the limits of decentralization. Token holders elect the 12-member council. Using an emergency privilege, the group moved funds from the attacker's address to a "burn wallet," effectively locking them. Supporters said the intervention bought the market crucial time to curb further laundering and underscored a "security first" approach. Critics countered that the episode shows how a small group can still step in to change on-chain outcomes even in networks marketed as decentralized, calling the "code is law" premise into question and raising concerns about potential abuse. Arbitrum said the mechanism is transparent and community-authorized, designed as a last-resort safeguard for extreme situations. The project framed it as an attempt to balance security with decentralization, not a departure from decentralization.