Binance Asks ArbitrumDAO to Release 8,426 Frozen ETH and 74.56M ARB After Hack

The Council stated that no other users' funds or applications were affected, and that the frozen assets can only be moved through an Arbitrum DAO governance vote.

Timeline and Governance Requirements

Binance estimates roughly 49 days for the full process: one week of forum discussion, a one-week temperature check, a two-week onchain vote, then about 18 days before the return transaction executes. Binance cautioned the timeline could run longer.

Arbitrum's constitution requires at least 1 million delegated ARB to submit an onchain proposal. Approval needs more votes in favor than against and must meet a participation threshold. For constitutional proposals, that threshold is half of delegated votable tokens, subject to a floor of 150 million ARB and a ceiling of 450 million. The proposal must also clear waiting periods on both Arbitrum and Ethereum, including the rollup's challenge period.

Conditions in the Draft

The draft bars onchain submission and delivery while any restraining notice, writ, court order or other legal process blocking the transfer remains in effect, unless a competent court permits it. Binance would hold delivered assets separately at its recovery address while such claims are unresolved and defend competing claims at its own expense.

Before submission, Binance must sign indemnification agreements covering the Arbitrum Foundation, Offchain Labs and Security Council members. Those agreements would be governed by New York law, with disputes assigned to state and federal courts in New York County.

Customer Compensation and Withdrawals

Binance said it will cover affected users' losses through its Secure Asset Fund for Users (SAFU) and company treasury. Recovered assets could pay incident-related losses and costs, including replenishing reserves already drawn on to compensate customers. The exchange expects no direct DAO budget expense beyond normal governance overhead.

In its eighth recovery update, Binance also scheduled withdrawals to reopen progressively from 04:00 UTC on November 5 for selected assets on Ethereum, BSC, Base, Tron, Polygon and Sui. Availability will return asset by asset as each passes security checks, and deposits remain open.

Why It Matters

For Traders

ARB and ETH supply is not changing yet, but any approved release would return roughly 74.56 million ARB and 8,426 ETH to Binance over several weeks, so watch the Snapshot and onchain vote dates.

For Investors

The case tests how a major exchange recovers stolen funds through a DAO vote, a precedent that could shape how future exploits are handled on Layer 2 networks.

For Builders

The temporary Inbox contract upgrade used to freeze and recover assets is a concrete pattern for Layer 2 security response, and teams should review how its emergency powers are scoped and governed.