Aftermath of the $117 Million Exploit
The Mango Markets community is navigating a complex and controversial resolution following a significant security breach that led to the loss of $117 million on October 11. The decentralized finance (DeFi) protocol has proposed that the hacker be allowed to retain $47 million as a bug bounty while returning $67 million of the stolen assets. This proposal comes as a response to the exploit, as the community aims to mitigate losses for its users.
Voting Outcomes and Community Sentiment
According to updates on the governance forum, an overwhelming 98% of voters, equating to 291 million tokens, expressed support for the proposal. The vote, which was expected to conclude on October 15, stipulates that by endorsing the deal, Mango token holders agree to use funds from the treasury to cover any remaining bad debt, ensuring all Mango depositors are made whole. Furthermore, the community commits to not pursuing criminal charges against the hacker.
Community Reactions
The decision has elicited varying responses from the community. One user on Twitter expressed concerns about the magnitude of the proposed bounty, labeling the $50 million reward as excessive. They argued that the hacker should be compensated only for incurred costs, plus a reasonable bounty of $10 million, especially when compared to low offers made in previous cases of exploits, such as the $10 million whitehat bounty proposed for the $600 million Wormhole hacker.
Details of the Exploit
The hacker executed the attack by manipulating the collateral value of the MNGO native token and subsequently taking out substantial loans from Mango’s treasury. Following the exploit, the hacker proposed a settlement, initially asking for $70 million, and bizarrely voted in favor of their proposal using a portion of the stolen tokens.
Breaking Down the Agreement
The proposal details indicate that funds returned to the protocol will cover any outstanding debts, while credible assurances are made regarding the waiver of claims against accounts with bad debt and the non-pursuit of criminal investigations or fund freezes. This complex arrangement demonstrates the lengths the community is willing to go to ensure financial stability.
Conclusion: A Complex Navigation
As discussions surrounding the proposal unfold, the Mango Markets community faces the challenge of balancing user recovery with ethical considerations. While the approval of such a bounty raises questions about moral hazard and the precedent it sets, the urgency of protecting users’ interests remains paramount in the aftermath of this significant exploit.
