Made the change to PRFC since we haven’t moved to snapshot voting yet
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Agree but maybe decrease 50 Eth to something lower, maybe 30 Eth
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I agree with your ideas Tommy,
Would you find it reasonable to implement your plan but also provide an immediate relief of up to 25 eth per user and the remainder at a 100 eth/month at your proposed pace?
I only mention 25 eth per user immediately as it is nearly equal to the bounty which was offered to the hacker at current prices ~1.1m
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Generally agree. General preference toward a larger upfront amount (so long as the treasury has enough runway for 6-12 months), and a lower monthly drag.
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This might be more easy to implement. As others have suggested maybe a higher upfront amount would be better
Apart from the fee receiver (0xfdCE0267803C6a0D209D3721d2f01Fd618e9CBF8), are there any other addresses controlled by the DAO containing cryptoassets? It would help determine the optimal amount that can be allocated
Finally, what are the odds of reopening negotiations with the hacker? As a potential deal could still be better for victims and DAO overall
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Victim here. Higher upfront such as up to 50ETH/victim is preferred. Higher upfront means lower monthly after all so that more revenue stream from the protocol can be saved to be paid to the veLockers. Otherwise it will be a stress to the revenue stream.
And it’s not only better for victims but also better for the restoration of protocol’s reputation and market confidence. Imagine when potential users researching about PRISMA about the follow-on of this unfortunate incident, 50ETH per/victim upfront paid is like 70%(12 out of 17) of all the victims covered by more than/at least half of their losses. This recomp plan, if thoughtfully designed and executed, could be a turning point for the protocol’s future growth from the hit of this incident.
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I support Hans plan of 50 eth upfront and the remainder to be repaid via Tommy’s, 100 eth per month to victims as possible.
This is the simplest way to most victims whole barring a return of the funds from the hacker.
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After thinking more, I think pro rata is the fairest way. We are all victims and it is really difficult to say this affects one person less just by looking at onchain balances as there could be more than one person involved for the larger balances. The remainder paid off with future revenue split at 50/50 would be nice too.
Hopefully if mkusd /ultra minted returns or exceeds the levels before the hack, the amount should be quite easy to pay off. Ideally, I hope there is a breakthrough with the hacker situation too via negotiations.
Edited for pro rata
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Thanks for the original post bt8. It’s well thought out.
+1 to Han’s plan as well. The 50/50 split of revenue to pay off the remainder is a good idea as well, it keeps incentives in the protocol while still refunding the remaining users. This is what I would vote for.
It seems like there is general agreement that there should be a lump sum payment to make as many users whole as possible (while still maintaining enough runway) and a repayment plan going forward for the rest. If there is debate about the exact amount for the one-time refund, we can put up poll if that’s helpful. Seems like the sweet spot is likely in the 30-60 ETH range given the distribution of losses per user.
Edit: Just for reference, the median value is −49.079 ETH, so 50 ETH reimbursement seems reasonable.
Currently, there are 14,844,477 mkusd (@10% interest rate) and 1,320,783 ultra (@15% interest rate) minted. This implies the weekly revenue for the protocol is $32,268.
With 80k being the amount required weekly for the fee receiver, the true weekly burn rate is $47,732 assuming minted mkusd and ultra levels stay the same.
Prisma DAO currently holds approximately $312,000 USD of crypto assets (majority is ENA) in (link) and roughly $2.08 million USD in the Fee Receiver (link), totalling around $2.39 million USD
I propose that $1.5m is spent immediately to recompensate the victims. This would leave around 0.82m and a runway of around 18 weeks (890,000 / 47,732 ~ 18) which is around 4.5 months. This assumes minted mkusd and ultra does not increase at all and that amount to the fee receiver does not decrease.
At the current eth price ($2980) the proposed amount the be redistributed is 503.3557 eth
Below is a table illustrating potential payout distributions. First is pro rata where everything is split proportionally and after is an adjusted pro rata where the bottom 7 victims are repaid fully then the remainder is split pro rata.
| Victim | loss in eth | Initial % of debt | Pure pro rata payout | Alt pro rata % of debt | Alt pro rata payout | |
|---|---|---|---|---|---|---|
| 0x56A201b872B50bBdEe0021ed4D1bb36359D291ED | -1493.157 | 42.797% | 215.421 | 44.836% | 154.539 | |
| 0xcbfdffd7a2819a47fcd07dfa8bcb8a5deacc9ea8 | -736.713 | 21.116% | 106.287 | 22.122% | 76.248 | |
| 0xc487370895f6e8f5b62d99bf1472c95a94073379 | -328.008 | 9.401% | 47.322 | 9.849% | 33.948 | |
| 0x9fceded3a0c838d1e73e88dde466f197df379f70 | -296.046 | 8.485% | 42.711 | 8.890% | 30.640 | |
| 0x1b72bac3772050fdcaf468cce7e20deb3cb02d89 | -138.518 | 3.970% | 19.984 | 4.159% | 14.336 | |
| 0x3b15cec2d922ab0ef74688bcc1056461049f89cb | -102.84 | 2.948% | 14.837 | 3.088% | 10.644 | |
| 0x16f570e93fdbc3a4865b7740deb052ee94d87e15 | -94.582 | 2.711% | 13.646 | 2.840% | 9.789 | |
| 0x4a3fced7c536e39ca5292a024ee66c9b45b257ec | -79.3 | 2.273% | 11.441 | 2.381% | 8.207 | |
| 0xf8d1c9ab49219f7acf7b1d84705e5aea3b8ce0aa | -61.094 | 1.751% | 8.814 | 1.835% | 6.323 | |
| 0xf9ca66ef84c773fab422562ab41b1ee8d4397418 | -37.064 | 1.062% | 5.347 | 37.064 | ||
| 0xc47fae56f3702737b69ed615950c01217ec5c7c8 | -32.975 | 0.945% | 4.757 | 32.975 | ||
| 0x774bb9306df1cd921eb842b1388c78f75e6ef79f | -26.581 | 0.762% | 3.835 | 26.581 | ||
| 0x19562df3e7fd2ae7af4e6bd288b04c2c90405212 | -25.707 | 0.737% | 3.709 | 25.707 | ||
| 0x1b004189e64d5b2f71d5be554470e6c49e10123b | -18.357 | 0.526% | 2.648 | 18.357 | ||
| 0x3b82ee6c15b212ed69d5795bcd957e136eaa4bff | -11.147 | 0.319% | 1.608 | 11.147 | ||
| 0x14b30b46ec4fa1a993806bd5dda4195c5a82353e | -3.506 | 0.100% | 0.506 | 3.506 | ||
| 0x409c6c5ec5c479673f4c09fb80d0f182fcff643e | -3.343 | 0.096% | 0.482 | 3.343 |
Feel free to discuss other potential payout distributions, I’ve presented some which I think could be acceptable for all the parties involved. If following the “equal amount method” suggested above, everyone with debt above 38.297eth, will get 38.297eth.
With regards to the future repayment for the remaining 2985.5823 eth, the victims may forgo their share of revenue split until the end of the 4 months in favour of receiving the larger % upfront. Upon the end of the 4 months, everyone involved can reconvene and decide on future revenue split %s. However, if the protocol flourishes and manages to maintain over $42m minted mkusd and ultra then discussions can begin over revenue split to repay debt. ~$42m is the minted amount required at current interest rates to achieve $80,000 per week in protocol revenue. This is also up for discussion, I’m just posting thoughts I’ve had so far.
2 Likes
Hi,
Another victim here.
I support the idea of the 50ETH upfront and lower monthly fee thereafter.
Is there an idea of when a snapshot vote can take place?
BR
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So the idea presented here is an initial payout and then after 4.5 months - when the balance in the fee receiver could possibly be 0 - reconvene to check and decide what to do next?
Just highlighting @TommyGenesis’s post here again which is a bit different. Rather than a large upfront payout it is spread out at roughly 25eth/week paid out.
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This proposal of 100ETH per month is intriguing and repays victims fairly quickly, but how would the DAO fund this? We don’t have 2995 ETH to repay everyone, not even close.
According to previous messages the DAO pays out about 80k/week and according to Defi Llama in the last week collected about 46k in fees. At this rate the DAO is burning reserves without even starting to repay victims. Source
What if we paid out a cap of 25 ETH to all victims first and then 50% of the weekly revenue? At current rates, a cap of 25 ETH is about 350 ETH, or about 1M USD. That’s less than half the treasury. 6 wallets would be made whole and 2 more would be pretty close to being whole.
From that moment on recovering the capital would be completely dependent on the success of the protocol. It’s a less guarantee future for the remaining wallets, but it’s a more likely scenario that the DAO and the project survive and when better times come bigger payments can also follow
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I think we should keep in mind
-
chances of eth rising in price making repayment even longer (it is relatively cheap/flat now to repay upfront) how much more taxing will it be on the DAO once eth is 6000$ per eth or 10000$ per eth?
-
$311,000 USD of ENA tokens that could be used towards this upfront eth amount (link)
Would really like to see it settled closer to 35-38 eth as Victim pointed out above upfront
And lowering the weekly payout amount afterwards
Thanks for the reminder @bt8. I recalculated using today’s numbers, corrected for wstETH and added the ENA tokens. I think this is a solid option.
We could pay an upfront cap of 30 ETH, making whole 6 victims and 2 more victims would be just a few ETH off full repayment and still leave 1.3M USD in the treasury. At current rates of 46k USD fee income and 80k vePrisma dues, we would still have 40 weeks runway.
Here is a quick table only of the payment:
| Wallet | wstETH loss | wstETH repayment | Loss left |
|---|---|---|---|
| 0x56A201…D291ED | 1281.897208 | 25.72503878 | 1256.172169 |
| 0xcbfDfF…Cc9eA8 | 632.473987 | 25.72503878 | 606.7489482 |
| 0xC48737…073379 | 281.597436 | 25.72503878 | 255.8723972 |
| 0x9FceDE…379f70 | 254.15799 | 25.72503878 | 228.4329512 |
| 0x1B72Ba…B02d89 | 118.919959 | 25.72503878 | 93.19492022 |
| 0x3B15CE…9f89CB | 88.211928 | 25.72503878 | 62.48688922 |
| 0x16F570…d87E15 | 81.199696 | 25.72503878 | 55.47465722 |
| 0x4A3Fce…b257eC | 68.080547 | 25.72503878 | 42.35550822 |
| 0xf8D1C9…8Ce0aa | 52.374561 | 25.72503878 | 26.64952222 |
| 0xf9Ca66…397418 | 31.825258 | 25.72503878 | 6.10021922 |
| 0xc47faE…c5C7C8 | 28.218348 | 25.72503878 | 2.49330922 |
| 0x774bB9…6Ef79F | 22.816279 | 22.816279 | 0 |
| 0x19562D…405212 | 21.92391 | 21.92391 | 0 |
| 0x1b0041…10123B | 15.755664 | 15.755664 | 0 |
| 0x3B82eE…AA4bfF | 9.498108 | 9.498108 | 0 |
| 0x14B30b…82353e | 3.006842 | 3.006842 | 0 |
| 0x409C6c…ff643e | 2.74901 | 2.74901 | 0 |
| Totals | 2994.706731 | 358.7252396 | 2635.981491 |
| Totals in ETH | 3492.364101 | 418.3378412 | 3074.02626 |
| Dollar equivalent | 9253733.64 | 1292676.479 | 9498833.363 |
Remaining treasury in USD 1,338,549
Separately the DAO could decide to reduce the payments to vePrisma owners and increase a monthly payment to victims
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35 ETH cap makes 7 victims whole and the 8th is only 1.8 wstETH short of being whole.
This still leaves 5 weeks of runway (about 1.175M in treasury)
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Correction, it’s 35 weeks (not 5) or about 8 and a half months.
Agreed that 100ETH monthly is probably too optimistic for what the current revenue looks like. I agree a larger first payment is probably in the best interest of all parties, to knock down as much debt as possible.
The table further up from @Victim showing pro-rata rates and adjusted pro-rata rates, I don’t think is more fair, for a just a couple of reasons. Pure pro-rata means extremely small payments made to small victims over the course of the full repayment period. These smaller victims will have a much larger proportion of their payout consumed in gas costs to claim. It’s not so much an issue for the initial large payout, but subsequent payouts would likely not be worth claiming without allowing several to stack up first.
The adjusted pro-rata creates a cut-off where some smaller victims receive a larger payout than larger victims. In your table, the 10th victim receives a larger payment than victims 3-9.
Personally, I think the table from @VictimsBFF is a more fair structure.
If any of the larger victims represents a group of people, I think that needs to be substantiated so that the DAO can take this into consideration without having to make assumptions.
I will also play devil’s advocate here. Discord user punkmen21 has repeatedly complained in discord that no proposal or comment mentions team and investor wallets covering a portion of repayment. This user frequently deletes their discord messages, and has refused to participate in the forum directly, for whatever reasons.
I’m not a fan of assigning blame, and certainly am not a fan of most of punkmen21’s ideas (which includes increasing vePrisma payments and doing whatever possible to not pay victims back from protocol revenue / making victims rely on law enforcement recovery of funds). But I do think it’s worth asking if there are any other sources of funds that are available. If debt tokens are out of the question for victims, perhaps the protocol can find funding in other ways, such as further investment from partners like Yearn and Convex if they are willing, or some commitment from team to reinvest their own mkusd rewards from veprisma, etc.
Anything that can be done to help is worth at least being mentioned.
2 Likes
Agreed with Tommy’s post, because of the specific distribution of the number each victim’s lost in this hack, using @TommyGenesis’s equal splitting method for the monthly payment after the upfront is way better than a pure pro-rata method, for EVERY victim including the whales. Since the repayment will accelerate as more and more victims got paid-off, the rest bigger victims’ll have far more amount allocated for each repayment and dramatically shortened span of time for repayment.