Arbitrum Freezes Hacker's 30,766 ETH via System-Level Transaction

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Arbitrum froze 30,766 ETH from the KelpDAO hacker using a system-level transaction. The action, executed via ArbitrumUnsignedTxType (EIP-2718 type 0x65/101), was injected through ArbOS and does not require a chain rollback. Haseeb Qureshi noted that this move underscores Arbitrum’s contract security mechanisms and the emergency powers of the security council as outlined in its decentralization plan.

ChainCatcher report: Dragonfly Managing Partner Haseeb Qureshi analyzed the event in which the Arbitrum Security Council froze 30,766 ETH stolen by the KelpDAO hacker, stating that this transaction type is ArbitrumUnsignedTxType (EIP-2718 type 0x65/101)—a system-level transaction that cannot be signed by a regular EOA but can only be injected into ArbOS by the Arbitrum Security Council. This action did not involve a chain rollback or historical rewrite; functionally, it is a state-level recovery: the attacker’s private key can still sign transactions, but the ETH at that address has been transferred by the chain itself. This operation also demonstrates the Security Council’s authority under “catastrophic emergency” scenarios as described in Arbitrum’s progressive decentralization documentation.

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