DeFi
www.coindesk.com
16 May 2023 19:49, UTC
Reading time: ~2 m
A cadre of decentralized finance (DeFi) protocols are coordinating to rescue about $300,000 in crypto that got frozen during the biggest hack of 2023.
The owner of the crypto, Inverse Finance, fears arbitrageurs are gearing up to grab the hoard once it unfreezes on June 8.
A plan outlined Tuesday would see the automated market maker Balancer execute a “permissioned arbitrage” of its “bb-e-USD” pool “before anyone else can get to it,” according to a forum post from Balancer’s governance lead. Balancer had frozen the pool on an emergency basis in Mid-March when the borrow and lend platform Euler Finance lost $200 million to a hacker (who later returned the funds).
Currently in discussion, the plan needs approval from Balancer’s community members, since the DeFi protocol would have to modify its mechanics. Organizers plan to hold a second vote on distributing the recovered tokens once the arbitrage is complete.
DeFi’s lego bricks lock together in complicated ways, and the Balancer situation offers another example. It has already gotten the green-light from three other protocols: TempleDAO, which will loan Balancer specialty stablecoins that it needs to conduct the arbitrage; Euler, who patched the smart contract; and Inverse, which wants its money back.
“Inverse is clearly very concerned about recovering their coins,” the pseudonymous Balancer contributor Tritium wrote in a forum post.
Tritium did not immediately respond to a request for comment, and neither did representatives of TempleDAO or Inverse Finance.
Sourced from cryptonews.net.
