Odaily News The official team of the Resupply Protocol initiated a remediation proposal in the community, which mentioned that it suffered 10 million ReUSD bad debt 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 set of proposed governance actions to eliminate protocol bad debts and provide retention rewards to affected users. Phase 1: Immediate governance action Insurance Pool (IP) token destruction 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 2,868,832 reUSD. The proposal specifically stipulates: 1.6,000,000 ReUSD of bad debt will be burned through the insurance pool, accounting for 15.5% of the 38.7 million reUSD in the insurance pool. 2. The protocol will process 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 protocol fees and/or a potential RSUP over-the-counter sales program, which will be decided at a later date in 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 time for voters to vote on this proposal will be shortened to 3 days for the updated Resupply voters. 2. By utilizing a shorter voting window, the DAO can make a quick on-chain decision on this proposal for the benefit of depositors and reach a final resolution within the initial 7-day IP cooling period. 3. The DAO may choose to extend the regular voting period to 7 days after the end 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 Plan applies to users who are insurance pool depositors at the time of this proposal and who were 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 staying in the insurance pool after slashing through additional streamed RSUP tokens. Opting in is the default option, but users can opt out at any time if they decide not to participate. Opting out will distribute the additional streamed RSUP shares to the remaining shares. The plan requires the deployment of a contract, which will be enacted at a later date once the contract has been reviewed and deployed. Project Revenue Sources A dedicated RSUP release receiver will be created for the Retention Plan. If passed, the proposal commits the DAO to distribute a total of 2.5 million RSUP to recipients over a 52-week period. The vast majority of this will come from RSUP grants from the Treasury. The tentative release period is for the next 12 months. Note: The 'pre-treasury' amount includes 541,851 accumulated/unclaimed treasury RSUP. 25% of the borrowed emission is for the Retention Plan, and the rest comes from the Treasury. Target: Previously planned to lend 2,875,000; later planned to lend 2,156,250; previously the treasury had 2,641,851 tokens; later reduced to 860,601 tokens. The insurance pool will slash 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.