The Resupply protocol released an emergency recovery plan proposal, intending to deal with the protocol's bad debts through the protocol treasury and DAO organization within 3 days

Odaily News The Resupply Protocol official team initiated a remediation proposal in the community, which mentioned that 10 million ReUSD was badly owed when it was hacked earlier this week. The attack and technical details are beyond the scope of this document, but can be found here. The stolen funds are still on the chain. The situation is currently being monitored and necessary steps are being taken.
This document outlines a proposed set of governance actions designed to eliminate protocol bad debt and provide retention rewards to affected users.
Phase 1: Immediate Governance Action Insurance Pool (IP) Token Burn At the time of writing, the total outstanding bad debt is 7,131,168 reUSD after the Resupply Protocol Treasury, Convex Treasury, and C2tP have paid out 2,868,832 reUSD.
The proposal specifically provides that:
1.6,000,000 ReUSD of bad debts will be burned through the insurance pool, accounting for 15.5% of the 38.7 million reUSD in the insurance pool.
2. The agreement will address ongoing bad debts to reduce the amount owed by the insurance pool. Overall, this is $4 million less than the amount of bad debt originally owed by the insurance pool.
3. The remaining bad debt ($1,131,168) will be repaid through a mix of future revenue sources such as, but not limited to, agreement fees and/or a potential RSUP off-market sales program to be determined at a later date by the Finance or Governance Department.
IP Withdrawal Period
1. The authorities are making every effort to shorten the mandatory lock-up period of user funds in the insurance pool. To this end, the voting time for voters in the updated Resupply proposal will be shortened to 3 days.
2. By utilizing a shorter voting window, the DAO can make a quick on-chain decision on the proposal for the benefit of depositors and reach a final resolution within the initial 7-day IP cooldown period.
3. The DAO may choose to extend the regular voting period to 7 days after the close of this proposal, or explore other options, such as different voting times for standard and emergency votes.
Recovery Phase 2: Insurance Pool Retention Plan Overview
The IP Retention Program applies to users who are depositors in the insurance pool at the time of this proposal and who are slashed in Phase 1 above. It is not intended to offset slashing, although it may or may not do so; rather, it is intended to incentivize remaining in the insurance pool after slashing through additional streaming RSUP tokens. Opt-in is the default, but users can opt-out at any time if they decide not to participate.
Opting out will distribute the additional inflow of RSUP shares to the remaining shares. This proposal requires the deployment of contracts, which will be issued at a later date once the contracts have been reviewed and deployed.
The project revenue stream will create a dedicated RSUP release receiver for the retention program.
If passed, the proposal commits the DAO to distribute a total of 2.5 million RSUP to recipients over a 52-week period. The majority of this will come from the Treasury’s RSUP grant.
The tentative release period is the next 12 months.
Note: The 'pre-finance' amount includes 541,851 accumulated/unclaimed financial RSUPs. 25% of the borrowed emissions are for retention programs, the remainder comes from the Treasury.
Target: Previously, it was planned to lend 2.875 million tokens; afterwards, it was planned to lend 2.15625 million tokens; previously, the treasury had 264.1851 tokens; afterwards, the number of treasury tokens was reduced to 860,601 tokens.
The insurance pool will be slashed by 6 million reUSD, and the DAO will assume the remaining bad debt.
The slashing proposal will be implemented within three days of the governance vote being published. A retention plan for slashed insurance pool participants will be enacted in the future.