Court Allows Transfer of ETH Tied to North Korea Hack, Legal Freeze Remains

A New York court has given approval for nearly $71 million in Ethereum, previously frozen due to ties with a North Korean cyberattack, to be moved to the Aave decentralized finance protocol. The order, issued by Judge Margaret Garnett, enables these assets—currently held on Arbitrum—to be shifted for custody or management purposes as proceedings continue.

Despite this transfer permission, the court emphasized that the legal freeze on these assets will remain. The restriction ensures the funds cannot be withdrawn, sold, or otherwise disturbed while claims from plaintiffs alleging terrorism links are still being resolved. The case highlights the ongoing legal complexities surrounding digital asset seizures related to cybercrime and international sanctions. It also underlines the challenges of asset control within decentralized platforms amid cross-border legal disputes.