- Binance has asked ArbitrumDAO to release around $30.5 million in frozen cryptocurrency linked to its October 29 security incident.
- The frozen assets include 8,425.997 ETH and 74.56 million ARB tokens.
- The recovery request needs approval from ArbitrumDAO, and the process could take around 49 days. Legal claims could delay the transfer further.
Binance Makes Request To Unfreeze Funds
Cryptocurrency exchange Binance has requested ArbitrumDAO approves a total of around $30.5 million in cryptocurrency assets being unfrozen, including 8,425.997 Ether (ETH) and 74.56 million Arbitrum (ARB) tokens.
This request was made on November 5 with the Constitutional Arbitrum Improvement Proposal (AIP) governance proposal to transfer funds to a recovery wallet.
The funds were frozen by the Security Council of Arbitrum on October 30 after identifying a wallet address associated with the October 29 incident. The assets have been transferred to a special address. The total amount of assets that have been frozen as part of the recovery operation are worth over $3 billion.
Using Funds To Make Up Losses
Binance has stated that the Secure Asset Fund for Users (SAFU) and company treasury will make up losses from the incident. However, the exchange now wants to utilise the frozen funds to help cover costs and make up the reserves used to compensate affected customers.
The recovery wallet has been specified, but Binance has also made clear that it is not requesting that ArbitrumDAO provide further funds from its treasury. The request must be approved by members of ArbitrumDAO.
The proposal also states that if there is any court orders, injunctions or legal limitations preventing the transfer then the proposal cannot proceed.
Binance has agreed to ensure that the funds are kept separate and not moved or mixed with other funds until any legal claims have been settled. Binance has also offered to pay any legal costs and other costs incurred by the Arbitrum Foundation, Offchain Labs and members of the Security Council.
The recovery process can take around 49 days. A week will be spent discussing on the Arbitrum governance forum, a week for an initial vote using Snapshot. Finally, the proposal will take two weeks to be voted on-chain. The remainder will be spent on technicalities and transactions.
The proposal also highlights the role of the Arbitrum Security Council who have the power to act quickly to protect assets on the network. The council consists of 12 members who are elected by ArbitrumDAO. In April 2026, they froze 30,766 ETH associated with the KelpDAO exploit which sparked questions surrounding the emergency powers and decentralized governance.
In this case, the council have ensured the funds have been secured and they are now at the mercy of ArbitrumDAO. This will highlight how blockchain communities manage the delicate balance of protecting stolen assets whilst respecting legal rights and keeping decentralized.
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