Cypher to Adopt “Socialize” Losses Approach in the Recovery Plan
In an advanced report, the Solana-based trading platform Cypher announced the recovery plans the firm plans to implement after suffering an exploit that resulted in $1 million losses. In the initial phase of the recovery plan, Cypher intends to adopt a “socialize losses” approach.
The crypto exchange will issue a “pro rata redemption package” of the total assets available. Guided by the recovery plan, the Cypher team plans to support the withdrawal of the existing assets through a web interface.
Cypher Recovery Plan
The trading company lacked sufficient funds to compensate all the depositors. In the report, the Cypher team agreed to distribute the losses to all the account holders at the primary stage.
Afterwards the trading platform plans to host fundraising projects in the subsequent stage through the initial DEX offering (IDO). The funds generated from the funding program will be used for audit purposes and other critical activities.
In the second stage of Cypher’s recovery plan, the trading platform will issue a debt token, which will constitute the remaining amount Cypher owes the depositors. The report demonstrated that Cypher intends to compensate the depositors at a standard rate of 31 cents on every dollar.
In the latter, the trading platform underlined that the debt token will be used to compensate the affected user in the future. The Cypher team plans to refund the users from the profits generated from USD Coin (USDC).
Cypher Plans for Public Audits
Addressing the media, the Cypher group stated that its top priority was to refund the exploit victims. As the Dubai-based trading firm seeks to compensate the affected users, the Cypher team will take proactive measures to prevent financial losses.
Immediately after completing the intended refunds, the Cypher team will hire auditors from leading audit firms such as OtterSec and Mad Shield. The primary purpose of the expected public audits is to identify any existing bug before it becomes a significant problem.
The Cypher team anticipates to resume operation after the auditor has meticulously evaluated the protocol. The upcoming audits are expected to address any system vulnerability existing on the protocol. Before then, the Cypher team blocked the applications on the smart contracts following a security incident that resulted in a $1 million loss.
In an X post dated August 8, Cypher announced plans to hold private talks with the bad players to return the lost assets. The trading platform confirmed to conduct investigations concerning the matter.
Besides engaging the investigators, the trading platform has managed to freeze lost assets worth $600000 on the centralized exchanges. The firm plans to cooperate with CEXs and law enforcers to issue seizure warrants preventing hackers from transferring the funds to other addresses.
Tokenhell produces content exposure for over 5,000 crypto companies and you can be one of them too! Contact at info@tokenhell.com if you have any questions. Cryptocurrencies are highly volatile, conduct your own research before making any investment decisions. Some of the posts on this website are guest posts or paid posts that are not written by Tokenhell authors (namely Crypto Cable , Sponsored Articles and Press Release content) and the views expressed in these types of posts do not reflect the views of this website. Tokenhell is not responsible for the content, accuracy, quality, advertising, products or any other content or banners (ad space) posted on the site. Read full terms and conditions / disclaimer.
