Tribe DAO votes in favor of repaying victims of $80M Rari hack

September 22, 2022 Coin Telegraph

Tribe DAO votes in favor of repaying victims of M Rari hack

The vote to reimburse users affected by the hack was one of the final governance decisions for Tribe DAO which has announced plans to wind down.

After months of uncertainty, the Tribe DAO has passed a vote to repay affected users of the $80 million exploit on decentralized finance (DeFi) platform Rari Capital's liquidity pools.

Following several rounds of voting and governance proposals, Tribe DAO, which consists of Midas Capital, Rari Capital, Fei Protocol and Volt Protocol, took the decision to a vote on Sept. 18 with the intent to fully reimburse hack victims.

Data from on-chain voting platform Tally shows that 99% of those who voted were in favor and the proposal was executed on Sept. 20.

According to the description underneath the voting data, individual users will be paid back in FEI, while DAOs will be paid in DAI. Users would also have to sign a message releasing any liability.

Fei's founder Joey Santoro on Twitter said the payment would be made 24 hours after the passing of the vote.

1/ The Rari Fuse Hack Payment has passed on-chain to FULLY pay the victims in 24 hours.

This is a big moment in these final governance decisions of the Tribe DAO.
— Joey ’s ERC-4626 (@joey__santoro) September 19, 2022

The total payment amount is 12.68 million FEI which is trading at $0.97 at the time of writing and 26.61 million DAI which is trading at $1, according to data from CoinGecko.

The vote was one of the final governance decisions for Tribe DAO which has announced plans to wind down.

In their Aug. 20 proposal, they explained the "challenging macro environment" and "specific challenges such as Rari Capital's Fuse hack" were all factors in the decision.

"At this stage, a responsible choice for the DAO to consider is leaving the protocol in a state which would defend the FEI peg without the need for governance."

The whole process of reimbursing victims of the hack has been ongoing, with several rounds of voting through snapshot signaling polls and on-chain; however, none ended in a resolution for affected users.

In a Sept. 20 Twitter post Joey Santoro explained the challenges they all faced in coming up with a solution and hopes that other DAOs can learn from the incident.

"The biggest lesson here is that DAOs should not have to make decisions like this after the fact. An explicit upfront policy, ideally with on-chain enforcement, would have saved the DAO from needing to venture into uncharted governance territory."

6/
I hope everyone can take away these lessons and know that all of the stakeholders truly did their best in an unprecedented situation.
— Joey ’s ERC-4626 (@joey__santoro) September 19, 2022

Following the hack, a $10 million bounty was offered to the hackers but it was never disclosed if they responded.

DeFi Protocol Built on Ethereum Explodes 125% in Hours As Centralized Finance Firms Struggle

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Attackers Steal $80 Million From Rari Capital’s Fuse Platform, Fei Protocol Suffers From Exploit

April 30, 2022 Bitcoin.com

Finance Redefined: Celsius raises $400M, and Rari’s 7.5K% yields, Oct. 11—15

October 16, 2021 Coin Telegraph

Finance Redefined: Celsius raises 0M, and Rari’s 7.5K% yields, Oct. 11—15

celsius network

Lending firm Celsius raised $400 million, Rari Capital exceeded $1 billion in TVL, and North America witnessed surging crypto volume — all included in this week’s Finance Redefined.

Welcome to the latest edition of Cointelegraph’s decentralized finance (DeFi) newsletter.

In a week where Rari Capital achieved the $1billion TVL milestone, read on to discover why OlympusDAO is yielding four-figure sums on its most popular protocol.

What you’re about to read is a shorter, more succinct version of the newsletter. For a comprehensive summary of DeFi’s developments over the last week, subscribe below.

Celsius Network raises $400M to expand institutional service

Cryptocurrency lending platform Celsius Network announced a $400 million equity fundraise this week led by Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ) and equity firm WestCap, taking the company’s valuation in excess of $3 billion.

The firm has expressed intentions to utilize the funds in a two-fold strategy: enhance its institutional product and service offering, as well as doubling the workforce to nearly 1,000 employees across the globe.

Celsius Network CEO Alex Mashinsky revealed to Cointelegraph the financial impact the platform is having on the lending sector:

“With more than $25 billion in assets and over $850 million in yield paid to over 1.1 million users, Celsius has distributed 10x more yield for the crypto community than any other lender.”

This funding news coincides with enhanced political scrutiny for crypto lending platforms in the United States. In September this year, Celsius encountered legislative resistance from the Texas State Securities Board and New Jersey Bureau of Securities, which threatened to terminate activity due to the alleged selling of unregistered securities.

Despite this, Celsius has consistently maintained its innocence of wrongdoing and has been willing to communicate and cooperate with regulatory agencies.

Rari Capital smashes $1B in TVL

DeFi protocol Rari Capital surpassed $1 billion in total value locked (TVL) this week to reach an all-time high of $1.225 billion according to analytical data from ranking platform DeFi Pulse.

The eight-figure total marks a monumental rise from $500 million two weeks ago and just $100 million three months ago. Launched in July 2020, Rari provides an automatic yield optimizing strategy to participants in the DeFi space seeking to secure the highest possible return from their investment.

A number of its liquidity pools have garnered noticeable attention for their lucrative returns, such as the USDC deposits, which offer a 21.67% annual percentage yield (APY), and the Dai pool, which offers 26.43% APY.

Despite these higher-than-average returns in comparison to the industry standard, it has been the OlympusDAO within the Fuse Protocol’s Tetranode’s Locker that has truly stolen the headlines over the past few months.

OlympusDAO is an algorithm-centric rebase model whereby token balances fluctuate over time depending on changes in the token price and the supply in circulation. As of writing, the OlympusDAO sOHM token is yielding a seismic 7,594% APY.

North America’s surging DeFi volume

Monthly cryptocurrency transaction volume in the North American region expanded 1,000% over a one-year period from July 2020 to June 2021 by virtue of the flourishing DeFi sector according to data released this week by analytics platform Chainalysis.

The annual Geography of Cryptocurrency Report revealed that monthly volume peaked at $164 billion during May 2021 before descending to $100 billion in June. In addition, DeFi transactions equated to 37% of the region’s total volume at $276 billion.

David Gogel, growth lead at decentralized derivatives exchange dYdX, commented on the findings that the biggest volume recorded was driven by retail consumers:

“Right now, DeFi is targeted towards crypto insiders. It’s people who have been in the industry for a while and have enough funds to experiment with new assets.”

Token performances

Analytical data reveals that DeFi’s total value locked has increased 8.11% across the week to a figure of $146.89 billion.

Data from Cointelegraph Markets Pro and TradingView shows that DeFi’s top 100 tokens by market capitalization performed varied across the last seven days.

Perpetual Protocol (PERP) secured the podium’s top spot with a respectable 29.7%. RenBTC (renBTC) came in second with 6.03%, while Wrapped Bitcoin (wBTC) came a close third with 6.00%.

Analysis and deep dives from the last week:

Thanks for reading our summary of this week’s most impactful DeFi developments. Join us again next Friday for more stories, insights and education in this dynamically advancing space.

Rari Capital doubles TVL to $1B in just two weeks thanks to high yields

October 13, 2021 Coin Telegraph

Rari Capital doubles TVL to B in just two weeks thanks to high yields

Coin Telegraph

The billion-dollar TVL has been driven by massive yields on the DeFi aggregation platform.

The total value locked on the decentralized finance protocol Rari Capital has surged past $1 billion.

The DeFi lending, borrowing, and yield generating protocol has surpassed the key milestone in TVL according to the app dashboard, and DeFiPulse confirms the all-time high TVL figure, reporting it at $1.09 billion.

On Sept. 30, Cointelegraph reported that Rari’s TVL had topped $500,000 so the doubling of collateral has taken around a fortnight. (DeFi Llama meanwhile, estimates TVL at $889M but going up fast.)

Rari launched in July 2020 to automate DeFi by optimizing and moving users’ funds to the highest yielding incentives at the time. It gained a certain amount of attention at the time as it was launched and run by teenagers and those just out of their teens.

Recent momentum has been driven by a number of liquidity pools offering higher than industry typical returns. It is currently offering a 21.67% annual percentage yield on USDC deposits and 26.43% APY in the DAI pool.

Its Fuse protocol has been extremely popular as it allows users to create custom lending and borrowing money markets with any assets and unlimited parameters.

The top pool called “Tetranode's Locker” has $655 million supplied, or 62% of the total, across 18 crypto assets earning various yields. Within that pool, the OlympusDAO sOHM token is currently yielding a whopping 7,594% APY.

OlympusDAO is an algorithmic currency protocol that allows users to supply crypto assets such as ETH or DAI to create bonds that back its native currency OHM. The complex bonding process acts as a hybrid fixed income product and a derivatives contract with quotes provided in OHM for trades at a future date.

Rari Capital thanked the “Ohmies” for helping propel its TVL to record levels.

Thank you Ohmies https://t.co/EL5M4yzeI4
— Rari Capital DAO (@RariCapital) October 12, 2021

Rari also offers permissionless pools which allow any user to create any pool of assets including NFTs offering any interest rates.

Venture Partner at 3SE Crypto, David Silverman, congratulated the young team on the achievement:

“Huge congrats to @JackLipstone @jai_bhavnani @davidslucid and the whole @RariCapital team!”

The Rari protocol, like most in the DeFi sector, has its own governance token called RGT which has also been performing well recently.

RGT hit an all-time high on Monday, Oct. 11 when it surged to $34 according to CoinGecko. It has gained 50% over the past fortnight and is up 93% over the past 30 days. At the time of writing, RGT was changing hands for $29.77.

Rari Capital was exploited for $11 million in May which caused token prices to crash to $4.80 following the hack.

After $11M Hack, Rari Capital Team to Reimburse Lost Funds

May 10, 2021 The Crypto Briefing

Rari Capital allocates $26M from developer fund to compensate hack victims

May 10, 2021 Coin Telegraph

Rari Capital allocates M from developer fund to compensate hack victims

Coin Telegraph

Up to $26 million worth of Rari’s governance token may be distributed among users impacted by a hack that drained $10 million from the protocol this past weekend.

Following a $10 million exploit over the weekend, decentralized finance protocol Rari Capital is formulating a plan to compensate victims.

According to an official postmortem of the attack published May 9, the platform lost 2,600 ETH equal to 60% of all users’ funds in its Rari Capital Ethereum Pool. Rari automates yield farming by rebalancing users' funds and pools.

On May 10, Rari founder Jai Bhavnani posted an update revealing that all of the protocol’s contributors had voted to return the 2 million RGT tokens initially slated for developer incentives back to the project’s decentralized autonomous organization, or DAO, to reimburse users impacted by the hack.

While an exact distribution plan is still being discussed by Rari Capital’s developers and community, Bhavnani noted that tRGT token holders will be eligible to claim a share of the DAO’s stablecoin reserves during a May 10 community call.

The DAO currently holds 8.7 million tokens RGT worth $121.8 million, equating to roughly 1% of RGT's supply,

With the Rari Governance Token currently trading for $13.36 according to Coingecko, the total funds allocated to reimbursement are worth roughly $26.7 million at the time of writing. RGT prices dumped 44% following the hack, falling from $18 to $10 in less than an hour.

Bhavani noted the protocol was started as a fair launch project that did not sell tokens or raise money from venture capital. He added that the concept of a Rari Team has been disbanded and there are now only contributors and token holders.

The Rari Capital Ethereum Pool deposits ETH into Alpha Finance’s ibETH token as one of its yield-generating strategies. The attacker manipulated the contract to and withdraw more funds than they had deposited. A flash loan was taken out from the dYdX exchange in order to deposit ETH and make repeated withdrawals, draining the pool in the process.

The Rari Capital exploit follows several recent high-profile hacks in the DeFi sector, such as ForceDAO losing $367,000 in early April, and EasyFi losing as much as $60 million on April 20.

Rari is not the only protocol seeking to compensate its users, with cross-chain DeFi protocol EasyFi announcing that 25% of lost funds would be distributed to users immediately in the form of stablecoins, while the remaining 75% will be distributed as “IOU” tokens redeemable for EZ v2 tokens.

Defi Project Rari Capital Hacked for $10M in Ether, Project’s Pool Drained for 2,600 ETH

May 9, 2021 Bitcoin.com

Rari Capital falls victim to $11 million exploit

May 8, 2021 Coin Telegraph

Rari's RGT token is plummeting on the news.

After a $11 million attack earlier today, Rari Capital is the latest decentralized finance (DeFi) protocol to fall victim to a high-priced exploit

The platform, which builds optimized yield vaults and boutique lending pools, confirmed the attack in a Tweet and said that a full postmortem is forthcoming:

There has been an exploit in the Rari Capital ETH Pool related to our @AlphaFinanceLab integration.

The rebalancer has removed all funds from Alpha in response.

We are currently investigating the situation and a full report will be shared once everything is assessed.
— Rari Capital (@RariCapital) May 8, 2021

Per whitehat hacker Emiliano Bonassi, the exploit appears to be an “evil contract” exploit, in which an attacker ‘tricks’ a contract into thinking a hostile contract should have access or permissions. Alpha Finance announced in a Tweet that the hack was related to Rari’s interest-bearing ibETH vault, but that no Alpha funds were at risk:

Funds are SAFE on #AlphaHomora.

We are notified that @RariCapital has suffered from an exploit that was due to the incorrect assumption when using HomoraBank contract, as they were setting up an ibETH pool on their platform.#Alpha team is here to help.
— Alpha Finance Lab (@AlphaFinanceLab) May 8, 2021

The hacker’s wallet currently holds 4,005 ETH worth over $15,000,000, but a portion of those funds appear to be from a separate exploit.

Like many before him, the attacker appears to have considered sending a message to the Rari team, but cancelled the transaction. Because he paid a low gas fee, however, observers were able to notice the message as a pending transaction before it was cancelled:

The hacker has left a base64-encoded message saying

rari=REKT
alpha=ok # saved rari 6mhttps://t.co/WQpiPksDOX pic.twitter.com/ruMH8Wam5s
— banteg (@bantg) May 8, 2021

While taking the aborted victory lap, the attacker’s message also seemed to imply that the Alpha Homura team prevented an additional $6 million drain.

Already users are taking to Twitter to speculate about what form the team’s compensation plan might take. Compensating users affected by hacks and exploits is becoming an increasingly common practice, most recently with EasyFi revealing their compensation plan after a crippling $60 million exploit.

The Rari Capital team has often been a target of both community support and derision. The team is notably young, with one developer reportedly being 15 years old. One of their key investors, Twitter user Tetranode, joked on a recent Up Only podcast that, despite only being middle aged, the team frequently and playfully taunts him as a “boomer.”

As such, while some have criticized the team and attempted to blame youthful inexperience for the attack, other have noted that security practices in DeFi are continually evolving and have been quick to voice support for the team, including SushiSwap CTO Joseph Delong:

This is a tragedy, we love that team
— Jo-sofa De-lounge (@josephdelong) May 8, 2021

$RGT, Rari's governance token, is down 23.24% to $13.35 on the news.

Rari Capital Launches Fuse, Letting Users Create “Their Own Compound”

March 19, 2021 The Crypto Briefing

Rari Capital has launched an open interest protocol that supports any asset.

Rari Capital Rolls Out Personalized Lending Pools

Fuse allows users to create a pool, selecting their own assets, interest rate curves, and oracles. Any user can then enter and exit the pools trustlessly without consulting a DAO.

Isolated lending pools are a first for DeFi. Moreover, the ability to lend and borrow any asset is a radical step forward, unlike any other platform in the traditional world. In a Twitter post, Rari Capital CEO Jay Bhavanani said that the implications of such a product are “equally scary and amazing.”

He described Fuse as a tool that “enables anyone to spin up their own Compound.” DeFi protocols like Compound and Aave allow anyone with an Ethereum address to trustlessly enter and exit pools for borrowing and lending, but they currently don’t enable users to create their own.

In a blog post announcing Fuse, Bhavnani said:

“The implications of a product like this are massive and unexplored. I see the product eating up all value in the world.”

Rari Capital is working with Chainlink, DeFi’s most popular decentralized oracle.

The Rari DAO has already launched several pools, including one in which ETH, SOCKS, and DAI can be borrowed or provided as collateral. SOCKS is a cult DeFi token created by the Uniswap team. It was sold on a bonding curve and is redeemable for a physical pair of socks. It currently trades at $87,922.

The ability to provide any asset as collateral means that countless other less conventional assets could appear in Fuse’s pools one day.

According to Bhavnani’s Twitter post, users will be able to create their own pools “soon.”

The announcement post notes that more price feeds will be added for Balancer LP tokens, Uniswap LP tokens, Curve LP tokens, Yearn LP tokens, and Alpha Homora LP tokens in the future.

Fuse’s total value locked is currently just under $2.5 million.

Concluding the note, Bhavnani wrote:

“Enjoy exploring the future of finance. Honestly, even beyond finance. Have fun exploring the future.”

Disclosure: At the time of writing, the author of this feature owned ETH, ALPHA, and AAVE. They also had exposure to UNI, COMP, BAL, and YFI in a cryptocurrency index.

Rari Capital

Celsius Network raises $400M to expand institutional service

Rari Capital smashes $1B in TVL

North America’s surging DeFi volume

Token performances

Rari Capital Rolls Out Personalized Lending Pools

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