DeFi protocol Balancer has proposed a plan to return roughly $8 million in rescued assets to users affected by a major exploit earlier this month, which drained over $128 million from its vaults.
Recovered Funds and Distribution Plan
According to Balancer’s Thursday proposal, the $8 million slated for distribution was recovered through a combination of external white hat interventions and internal rescue operations. In total, about $28 million was salvaged, with $19.7 million in osETH and osGNO being managed by the liquid staking protocol StakeWise.
The reimbursement plan adopts a non-socialized model, meaning recovered funds will be returned only to liquidity providers (LPs) in the specific pools affected. Distributions will be pro-rata based on Balancer Pool Token (BPT) holdings at the time of the exploit. LPs will receive the recovered assets on a payment-in-kind basis, getting the same tokens that were recovered.
White Hat Involvement and Bounties
Six white hat actors who helped recover $3.86 million during the attack are eligible for 10% bounties, capped at $1 million per operation. Key recoveries include:
- Anon #1 – $2.68 million rescued on Polygon
- Bitfinding – $963,832 rescued on Ethereum mainnet
- Other smaller recoveries on Base and Arbitrum
White hats claiming bounties must complete identity verification, KYC checks, and sanctions screening under Balancer’s SEAL Safe Harbor Agreement. Some Arbitrum-based rescuers have waived their bounties by remaining anonymous.
Claim Window and Governance
Balancer has set a 180-day claim window for LPs to collect their recovered assets. Unclaimed funds will become dormant, requiring governance decisions for any future reallocation.
This plan represents a structured effort by Balancer to compensate affected users while maintaining transparency and incentivizing white hat interventions in the ecosystem.