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1inch Foundation Proposes User Compensation Plan Following October Hack

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In brief

  • A DAO proposal is seeking to reimburse $768,026 in USDC to affected users.
  • But victims must submit KYC and law enforcement reports.
  • The vote currently stands at 53.47% in favor, 46.53% against.

The 1inch Foundation has submitted a new proposal to its decentralized autonomous organization to compensate users affected by an October 2024 exploit.

The proposal, dubbed 1IP-80, outlines a reimbursement plan of $768,026 in USDC—the estimated value of the stolen tokens at the time of the attack—to be sourced from the DAO’s treasury.

The DeFi DEX aggregatir Foundation would oversee the verification and distribution process, requiring victims to complete Know Your Customer identity verification, provide evidence of losses, file a report with law enforcement, and sign a compensation agreement.

It did not specify precisely what KYC would be required. 1inch does not require users to complete a KYC process to trade on its platform, making it a popular choice for those who prefer not to use centralized exchanges that have this requirement.

A case is currently under investigation in the Canary Islands, whereby victims would also need to waive their right to any funds recovered in the future.

An exploit occurred on October 30 last year, when attackers compromised the 1inch decentralized application via a supply chain vulnerability in the Lottie Player library, a plugin used for animations on websites.



Unlike the more recent $5 million breach of 1inch in March 2025, which saw the return of most funds through negotiations with the hacker, no restitution was previously made in the October case.

Under the proposal, the DAO would transfer the funds to the Foundation, which would process claims and disburse compensation. Victims would be required to forfeit any rights to recovered assets, which would instead be returned to the DAO treasury.

As of publication, 30 votes have been submitted. The vote currently stands at 53.47% in favor (3.8 million votes) versus 46.53% (3.3 million) against.A single large voter wallet dominates each side. 

One wallet accounts for the entire 3.3 million ‘no’ votes, while another holds 2.2 million of the 3.8 million votes in favor.

The dissenting wallet argues that the DAO should not act as an insurance fund, citing a lack of recurring revenue. The vote remains open until June 22.

Edited by Sebastian Sinclair

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The full story behind the $260 million breach
NFT Gaming

Cetus Protocol relaunches with new roadmap and compensation plan after $223m exploit

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Sui network-based Cetus Protocol has relaunched with a new roadmap, open-source plans, and a compensation programme following a $223 million exploit.

The decentralized exchange unveiled its post-relaunch strategy in a June 8 blog post, outlining measures to enhance protocol security, upgrade monitoring systems, and transition toward full open-sourcing.

A newly structured white hat bounty programme has also been introduced to support community-driven security efforts.

According to the team, all affected CLMM pools have now been replenished using a combination of recovered assets, treasury funds, and a $30 million loan from the Sui Foundation.

Liquidity providers will regain access to their previous positions, with recovery rates ranging from 85% to 99%, depending on the extent of the damage to each pool.

To compensate for unrecovered losses, Cetus has allocated 15% of its native CETUS token supply to affected users. Of this, 5% will be immediately claimable, while the remaining 10% will be unlocked monthly over the next year, starting June 10. 

The team clarified that the 15% CETUS allocation introduces no new inflation, as it repurposes unvested team tokens within the existing supply cap.

Compensation claims will be tied to LP position NFTs, which will remain valid as certificates for CETUS redemption, even after liquidity is withdrawn.

The protocol has also completed new security audits covering all code patches, contract upgrades, and the compensation contract. Additional rounds of audits and real-time threat detection upgrades are planned to further strengthen protocol resilience.

The Cetus Protocol was exploited on May 22, after an attacker manipulated its liquidity pool pricing by exploiting a flaw in a third-party code library.

In the immediate aftermath, the Cetus team froze operations and began working with Sui validators to recover assets. An on-chain governance vote held on May 29 approved the transfer of $162 million in frozen funds to a multisig wallet for recovery.

Further, the Sui Foundation supported the effort with a dedicated USDC loan to backstop off-chain losses.

Cetus stated that legal proceedings are ongoing in multiple jurisdictions, with law enforcement agencies actively engaged. The attacker, who declined a $6 million white-hat bounty, is reportedly attempting to launder assets, although the team claims that most movements remain traceable.

“We are highly confident that successful arrest and recovering the remaining assets is only a matter of time,” Cetus wrote in the latest announcement.

If additional funds are recovered during the compensation period, users will have the option to redeem CETUS for USDC. Once that period ends, remaining funds will be used for token buybacks and deposited into the community treasury.

The latest announcement, however, failed to lift CETUS, which fell around 7% on the day, extending a downtrend that began in May.



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MLS, players still at odds on Club World Cup compensation
Esports

MLS, players still at odds on Club World Cup compensation

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The discussions between MLS and the MLS Players Association over the Club World Cup prize money and player compensation remain ongoing, with the two sides failing to agree so far on terms in a newly revised section of the collective bargaining agreement.

Seattle Sounders FC players first brought the issue to the forefront with a protest in front of fans at Lumen Field on June 1 by wearing shirts that read “Club World Cash Grab” and “Fair Share Now.” The MLSPA initially released a statement in support of the players’ actions, as the two parties demanded a fair share of the FIFA Club World Cup prize money the team secured when qualifying for the international tournament.

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The original CBA stated that players receive 50% of money from outside tournaments with a cap of $1 million. A source with knowledge of the discussions told ESPN that a revised proposal from MLS committed to grant players on the three participating teams 20% of the performance-related payments for wins, draws and round advancement.

Players collectively would receive $1 million for participation, in addition to any money earned for victories, draws or round qualification throughout the tournament. Separately, LAFC earned $250,000 collectively for the victory against Club America in a playoff on May 31 to secure a spot in the tournament.

The MLSPA received the proposal on Friday. A source with knowledge of the discussions added the MLSPA demanded a larger percentage but has not formally responded to the league’s proposal.

In a statement, however, the MLSPA called the actions taken by MLS as “retaliatory” and unsatisfactory.

“The timing, substance, and retaliatory nature of the proposal sends a clear message: MLS does not respect or value players’ efforts with regard to this tournament. Although not surprised, the players and the MLSPA are deeply disappointed by this message,” the MLSPA said in a statement.

“MLS’s refusal to negotiate in good faith has created a major distraction for the players who should be focusing on preparing for a major international competition. However, players will not be silenced by threats from MLS. The players remain united in using their collective voice and demanding a fair share of the rewards earned from their hard work.”

The organization later added that MLS introduced “back-end compensation of 20%, an amount that remains below the international standard” and “did not add a single dollar for players from the $28,650,000 windfall that MLS will be paid by FIFA.” According to the MLSPA, “the players’ share of that amount remains at barely 10%.”

The two sides have yet to agree on new terms, making the current CBA the standard.

A work stoppage by MLS players over the bonus dispute isn’t possible due to provisions in the CBA. Under the current CBA, players have agreed not to strike over issues that fall within the scope of the agreement. But they still have the right to engage in protected actions under federal labor law.

LAFC, Inter Miami CF and the Seattle Sounders will compete in the Club World Cup, which starts Saturday and runs through July 13.

ESPN writer Jeff Carlisle contributed to this report.



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SUI stalls below resistance amid $223M Cetus Protocol hack
GameFi Guides

Sui Foundation issues loan to Cetus for user compensation

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The Sui Foundation has stepped in with a secured loan to help decentralized exchange Cetus fully compensate users affected by a recent $223 million exploit.

In a statement posted on X on May 27, the foundation said the loan will cover funds that the hacker managed to bridge out of the Sui (SUI) network before validators froze their wallets. Cetus will combine the loan with its treasury assets to reimburse affected users in full, provided the community approves a separate on-chain vote to unlock the frozen funds.

Cetus echoed this sentiment in another statement, apologizing for the incident and asking the Sui community to support the recovery vote. “We are now in a position to fully cover the stolen assets currently off-chain,” the team said, “if the locked funds are recovered through the upcoming community vote.”

On May 22, Cetus suffered a complex exploit targeting a flaw in its concentrated liquidity market maker contracts. The attacker exploited unchecked math operations in a third-party code library and manipulated prices using a flash swap. As a result, they were able to drain several pools by faking liquidity deposits and repeatedly withdrawing real tokens.

The attacker managed to transfer a significant amount of the stolen assets to Ethereum (ETH), even though validators were able to freeze $162 million on-chain. These bridged funds are the focus of the current compensation plan.

The hack caused the CETUS token to drop by 40% and is still 20% down in the past week. The total value locked on the Sui network also fell from $2.13 billion to $1.77 billion, as per DefiLlama data. 

Though the bug was in Cetus’ code and not Sui’s base infrastructure, the Sui Foundation acknowledged its role in supporting ecosystem-wide security. Alongside the loan, the foundation announced an additional $10 million commitment to fund audits, bug bounties, and formal verification tools.

To encourage white-hat hackers to find vulnerabilities before they are exploited, it also intends to broaden its bug bounty program to include high-value protocols like Cetus, which have over $50 million in TVL.

While the quick action from validators helped prevent further damage, some in the community voiced concerns that freezing wallets undermines the decentralization ethos of blockchain. Others praised the swift response and transparent handling of the crisis.

A detailed recovery plan from Cetus is expected soon. Compensation efforts are scheduled to begin regardless of the vote’s outcome, though full recovery depends on whether the community supports unfreezing the remaining funds.





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