The emergency response prevented stolen funds from moving, but sparked debate over governance, control and the limits of decentralization on Layer 2s. Arbitrum’s Security Council intervened to “freeze” over 30,000 ETH tied to the KelpDAO exploit, showing that a small, elected group can step in during emergencies to move and lock funds, raising concerns about whether such powers undermine true decentralization. Arbitrum insiders argued the powers were always transparent and necessary for securit…
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