Tuesday, January 31, 2023
- Advertisment -
HomeNewsBusinessFei Flips Once More, Paying Off Crypto Hack Victims

Fei Flips Once More, Paying Off Crypto Hack Victims

The victims of the $80 million Fei Protocol attack have finally been compensated after months of conflicting signals.

A resounding 93 million of the 99 million votes were cast in favour by Olympus DAO, which suffered a $9 million loss in the April breach. One of the final decisions about governance that Fei’s Tribe DAO will make before being shut down was the vote.

This week’s release of Fei’s repayment strategy brings an erratic past several months to a close. The hacking protocol initially agreed to compensate the victims before deciding to simply provide partial compensation. Fei’s DAO ultimately decided to properly compensate victims after outrage.

Fei merged with lending protocol Rari Capital months prior to the Fuse lending protocol compromise. The relationship was a preview of what was to come in terms of insider governance at Fei.

After the recently-merged Fei was compromised in a hack in April, the Tribe DAO approved a Snapshot vote to compensate the victims. A disputed second vote was then held by Fei, who declared that it would end Tribe and stood against full payback.

According to DeFi scholar Luca Prosperi, “the way [the Fei-Rari merger] was constructed was extremely cruel for anyone who was not a majority controlling shareholder.”

Santoro said that the second poll, which was binding and on-chain, was the one that really mattered. Since the hacked Fuse Protocol was operated by Rari, which is still handled by a different team from Fei despite the merger, Fei does not view the April hack as its own obligation.

Fei’s hand-waving over its post-hack voting shows how DAOs are not always permissionless, with internal developer teams occasionally in charge of governance and making centralised choices behind the scenes.

Prosperi remarked, “In the end, there is no protection when sh*t hits the fan and it’s about money. “The jungle rules once more.” Fortunately for those who were hacked by Fei, Fei’s team chose against exploiting the situation. Following backlash against Fei’s proposed partial refund scheme, another Snapshot vote in favour of full repayment was approved, and a fourth vote, which was approved and carried out on Monday, restored the lost monies.

News Summary:

  • Fei Flips Once More, Paying Off Crypto Hack Victims
  • Check all news and articles from the latest Business news updates.


- Advertisment -