The hacker behind the Kelp DAO exploit has successfully laundered approximately $220 million in stolen funds, according to sources close to the investigation. The move effectively ends any realistic hope of recovering the bulk of the money. However, a significant portion — roughly $71 million — was frozen by Arbitrum’s Security Council before it could be moved.
How the funds disappeared
The attacker used a series of transactions across multiple blockchain bridges and mixers to obscure the trail, a common tactic in high-value crypto heists. Investigators say the laundering was completed over the past several days, making it nearly impossible to trace or claw back the stolen assets. The exact method and timeline remain under review, but the scale of the operation suggests sophisticated planning.
What Arbitrum’s Security Council did
Arbitrum’s Security Council stepped in during the initial stages of the attack. By freezing $71 million of the stolen stash, they prevented a larger loss. The council’s quick action likely saved that portion, though it remains unclear whether those funds can be returned to victims or will be held as evidence. The frozen amount represents about a third of the total haul; the rest is gone.
Why recovery efforts fell short
The hacker moved money faster than any freeze order could follow. Blockchain forensics teams tried to flag addresses, but the launderer switched chains and used anonymizing tools before authorities could react. Even with the partial freeze, the remaining $149 million is now distributed across hundreds of wallets, many outside the reach of regulators or platform operators.
Kelp DAO itself has not issued a public statement since the hack. The project’s developers are working with law enforcement, but they’ve acknowledged the slim chances of getting the full sum back. For users who lost deposits, the news is grim: only a fraction of the stolen value may ever be recovered.
