tl;dr
The 1inch Foundation has proposed reimbursing users affected by an October 2024 exploit with $768,026 in USDC from the DAO treasury. The plan, 1IP-80, involves the DeFi DEX aggregator Foundation verifying claims through KYC, evidence of loss, law enforcement reports, and compensation agreements. Vic...
The 1inch Foundation has proposed a reimbursement plan amounting to $768,026 in USDC to compensate victims of an October 2024 exploit. The plan, outlined in proposal 1IP-80, seeks to utilize funds from the DAO treasury to cover losses incurred during this incident. Victims would be required to undergo Know Your Customer (KYC) verification, provide evidence of their losses, file law enforcement reports, and sign compensation agreements. Notably, claimants must waive any rights to future recovered assets, which would revert back to the DAO treasury.
The October 2024 exploit originated from a supply chain vulnerability in the Lottie Player library, a plugin used for animations on websites. This differs from the March 2025 breach where a significant portion of stolen funds was recovered and returned. The DAO treasury would transfer the reimbursement funds to the 1inch Foundation, which would then handle claim verification and compensation distribution.
Voting on the proposal is currently underway and remains closely contested. As of now, 53.47% of votes favor the reimbursement plan while 46.53% oppose it. The vote is significantly influenced by two large wallet holders, one casting all the opposition votes, asserting that the DAO should not function as an insurance fund due to its lack of recurring revenue. The voting period closes on June 22.
This reimbursement plan highlights ongoing challenges within decentralized finance communities when addressing security breaches and compensating affected users. It also raises questions about the role of DAOs in managing risk and restitution without established revenue streams, inviting community discussion on sustainable governance models.