- The proposal states refunding 65,000 wallets across 14 different assets.
- Harmony team’s proposal to mint tokens worth $4.97 billion to compensate victims of the $100 million Horizon Bridge hack has been opposed by the community.
- The community believes that a large issuance of new tokens will lead to inflationary pressure on the asset.
Minting up to 4.97 billion worth of ONE, the native token, has been proposed by the team responsible to manage the Harmony blockchain. The aim behind the proposal is compensating those who faced the consequences of the $100 million Horizon Bridge hack.
However, the proposal has been brutally criticized by community members’ who believe that huge issuance of new tokens would not only cause inflationary pressure on the asset but also depreciate its value.
This proposal is disappointing. There is no other options. Seems to be either minting more tokens or minting more tokens. If we disagree, there will be no disbursement as per your proposal.— night 💙 (@night7576) July 27, 2022
Through the community page of the project, the Harmony team shared that 65,000 wallets were affected across 14 different assets. The team had been busy thinking and developing ways to reimburse the victims.
Considering the present state of Harmony’s treasury, the team isn’t able to come up with any solution regarding instant reimbursement. Hence, it came forward with two alternatives involving minting multiple billion ONE tokens through a hard fork to be assigned to the victims.
Providing 100% reimbursement through 4.97 billion new ONE tokens was the first option. The second option included 50% reimbursement including 2.48 billion ONE tokens over a period of three years.
Before heading any further, the team is waiting for feedback from the community; however, initial responses are quite negative and the majority of the comments could be seen on Twitter and the community page with strong concern about the proposed ideas.
I will vote no on this 100%. Its not the answer. Use part of the treasury to refund the providers and get everything is good standing and move forward. The investors and community shouldnt have to pay for it.— mcone.one 💙 (@mconecrypto) July 27, 2022
Similar method of recovery was used by the Terra ecosystem after a $40 million melt down in the month of May.
In June, for $100 million, the Horizon Bridge to the Harmony layer-1 blockchain was exploited. In the same month, there was an attempt to offer a $1 million bounty to the hacker, but the approach didn’t work.