Following a $6.2 million dollar flash loan exploit over the weekend, decentralize finance (DeFi) protocol Belt Finance has unveiled a compensation plan for the victims.
The latest Binance Smart Chain clone to get attacked was Belt Finance when it lost $6.2 million in a series of transactions that manipulated the system. The Rekt Blog, which released a post mortem on the exploit called it “another notch to the now infamous flash loan exploit season on the BSC.”
Belt Finance has now released a compensation plan, primarily for users who have had their funds in the 4Belt pool or beltBUSD vault, which were the targets of the attack.
The second group to be compensated is BELT token holders, it added since the price dumped 54% in the wake of the incursion.
“The price of the BELT token is a direct reflection of the value of Belt Finance as a protocol, and while BELT may not be a part of our 4Belt pool, it is representative of the faith our users have vested in us.”
Belt token airdrops
Belt Finance uses an optimal yield aggregator to offer passive yield generation to depositors via a number of strategies using other BSC protocols such as Elipsis, Venus, and Alpaca.
The first part of the recompense plan involves taking a snapshot of the 4Belt pool and 4BELT token holder addresses. They will be airdropped remedy4BELT (r4BELT) tokens in proportion to their holdings before the attack.
These new tokens can be used to access further compensation over time, the blog post added. Users will need to deposit the new tokens with the old ones on PancakeSwap to receive liquidity provider tokens which then need to be staked back into the protocol, so compensation has to be ‘earned’ effectively.
It added that 67% of the unlocked portion of the teams allocation will be distributed to r4BELT compensation, amounting to 864 tokens per day (valued at around $28,500 at current prices). The team are also committing $3 million USD to create a new BELT buyback fund, it continued. $1.5 million of this fund will be sourced from the PancakeSwap initial offering it launched with.
As reported by BeInCrypto, Binance Smart Chain claimed that these DeFi attacks were organized and targeted and advised extra vigilance from DeFi protocols, especially the clones.
BELT token price update
BELT tokens were trading up 3% on the day at $33 at the time of writing according to CoinGecko.
Before the attack, BELT tokens reached a price of $60 before collapsing to $27. BELT hit an all-time high of just over $200 on March 11.
