Curve Finance to pay $49M in restitution to hacking victims.
The community behind decentralized finance (DeFi) protocol Curve Finance has voted to restore liquidity providers (LPs) that were hit by a $61-million hack in July.
On-chain data confirms that 94% of token holders approved on December 21st tokens worth more than $49.2 million to cover the losses of Curve (CRV), JPEG'd (JPEG), Alchemix (ALCX), and Metronome (MET). Pools.
Just wanted to highlight the magnitude of this. Victims of this vote are fully committed: $7.2M worth of ETH returned by whitehats being distributed to the DAO – $42M worth of CRV compensation for unearned units (provided) – Other funds received by whitehats distributed before the vote https://t. Co/qmcK9pmTe5
— Curve Finance (@CurveFinance) December 22, 2023
The loss calculation includes the amount of Ether (ETH) and CRV tokens in the pools prior to the hack, as well as missed CRV releases that were distributed to LPS over the past months. According to Curve's proposal, the community fund will issue Curve DAO (CRV) tokens. The final amount also includes a discount for tokens recovered after the crash.
“The total ETH for recovery is 5919.2226 ETH, the CRV is calculated to 34,733,171.51 CRV, and the total for distribution is 55'544'782.73 CRV,” the proposal said.
The security incident occurred on July 30, and in the following days, the exploit exposed several DeFi protocols to a stress test due to the threat to the crypto ecosystem. In July, Curve's total value locked (TVL) was nearly $4 billion. Among the affected pools are alETH/ETH, pETH/ETH, msETH/ETH and CRV/ETH.
“While the stolen funds in each pool have been fully or partially recovered, MEV bots have caused shortages in all affected pools, and this reform proposal seeks to make the affected LPs whole,” Curve wrote in the decision.
The attacker exploited the vulnerability in stable pools using some version of the Vyper programming language, a popular choice due to its design for the Ethereum virtual machine for DeFi protocols. The bug made Vyper's 0.2.15, 0.2.16 and 0.3.0 versions vulnerable to re-entry attacks.
Magazine: This is your mind on crypto – Drug use grows among crypto traders
