After Shedding $100M, Concord Desires to Inflate Away Its Issues

Weeks after an attacker was capable of steal roughly $100 million from Concord Protocol’s cross-chain bridge, the Layer 1 undertaking has shared a controversial proposal to reimburse affected customers.

Concord Makes Reimbursement Proposal

Concord Protocol has shared a reimbursement proposal to compensate customers affected by its $100 million exploit in June, however the neighborhood isn’t proud of it. 

In response to the reimbursement plan submitted to the community’s governance discussion board early Wednesday, the Concord group has proposed a hardfork to mint extra ONE tokens that might be used to compensate customers affected by the current exploit on its cross-chain bridge. “The Concord group has labored tirelessly to brainstorm and develop paths in direction of reimbursing those that had been impacted by the current hack of the Horizon bridge,” reads the governance proposal, giving customers two choices to vote for. 

The primary possibility proposes a 100% reimbursement by minting 4.97 billion ONE tokens, roughly sufficient to make all affected customers entire primarily based on ONE’s present $0.20 market worth. The second possibility suggests solely a partial reimbursement by minting 69 million ONE tokens, which might cowl about half of the sufferer’s whole losses on the token’s present worth. Each decisions counsel steadily minting the brand new tokens over three years to forestall inflating the provision of ONE too shortly. Increasing on why it opted for this resolution, the Concord group mentioned:

“We determined in opposition to utilizing the muse treasury within the curiosity of the longevity and wellbeing of the undertaking as reimbursing from the treasury would significantly hinder the muse’s skill to assist the expansion of Concord and its ecosystem. Concord basis is dedicated to proceed supporting Concord for years to come back and plans to order the muse tokens to facilitate this.”

Nonetheless, the proposal has obtained overwhelming pushback from the Concord neighborhood. One of the vital upvoted feedback within the thread exclaimed “DO NOT MINT MORE!” and argued that inflating the ONE provide would “screw those that are staking.” One other person complained that that they had waited “2 weeks for this shitty proposal & no repeg,” adding {that a} hardfork would kill the chain’s already “small likelihood” of survival. 

A lot of the resentment seems to middle on Concord’s plan to guard its treasury whereas asking token holders to bear the brunt of the hack beneath the premise of needing funds to develop the undertaking. Some neighborhood members additionally didn’t appear to love Concord’s “take it or depart it” method. “Within the occasion of failure to acquire required validator participation, we are going to resort to “no reimbursement,” the group mentioned within the proposal. “How ought to I take a look at this assertion? A risk?” one individual replied. 

Concord’s cross-chain Horizon bridge was exploited for about $100 million on June 24 after a hacker reportedly gained entry to the majority of the non-public keys controlling Concord’s multi-signature pockets (Concord didn’t affirm how the incident occurred). The undertaking initiated a “international manhunt” following the incident, alerting exchanges, legislation enforcement companies, and blockchain evaluation firms. It additionally provided the hacker a $10 million bounty to return the stolen funds. Regardless of all of its efforts, the undertaking has did not determine the hacker or recuperate the stolen funds.

Disclosure: On the time of writing, the creator of this text owned ETH and several other different cryptocurrencies.