GMX finalizes $44M payout to GLP holders affected by V1 hack

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GMX has concluded its ~$44 million compensation plan for GMX Liquidity Provider holders on Arbitrum impacted by the July V1 vulnerability.

Summary

• GMX accomplished a ~$44M GLP holder compensation plan after July’s V1 exploit.
• Payouts had been in GLV tokens with DAO treasury help and retention incentives.
• GMX V2 remained unaffected and continues to see robust buying and selling exercise.

The replace was shared on X by GMX (GMX) on Aug. 13, following the protocol’s ultimate distribution spherical. The platform totally reimbursed affected wallets and provided incentives to retain distributed funds. 

Distribution finalizes restoration from July exploit

The exploit, detected on July 9, focused a re-entrancy flaw in GMX V1’s GLP pool. This enabled an attacker to govern brief common costs for Bitcoin (BTC) and drain roughly $42 million in property.

GMX halted GLP buying and selling, minting, and redemption on Arbitrum (ARB) and Avalanche (AVAX), later negotiating the return of ~$37.5 million below a white-hat bounty association. The attacker retained about $5 million.

The accomplished plan, permitted through a group Snapshot vote, distributed GLV, or GMX Liquidity Vault tokens, to eligible GLP holders. Similar to GLP’s pre-exploit composition, these vaults include roughly 25% Wrapped Bitcoin (WBTC), 25% Ethereum (ETH), and 50% stablecoins.

The GMX DAO offered $500,000 in retention incentives to holders who held GLV for 3 months, whereas additionally utilizing its treasury to cowl a $2 million shortfall. GLP held by the white-hat, representing 29% of the availability, was burned to revive proportional worth.

GMX V2 continues unaffected

GMX V2, which was not impacted by the incident, has maintained rising volumes and liquidity for the reason that exploit. The DAO is engaged on tailor-made restoration options for decentralized finance protocols that built-in GLP, with GLP redemptions anticipated to renew in about 10 days.

The exploit precipitated GMX’s token value to fall by as much as 28% earlier than partially recovering. Total worth locked dropped from $480 million to $409 million, however has recovered sharply to over $600 million as of press time. With V1 paused and set for eventual sundown, GMX’s focus is shifting fully to its V2 infrastructure.

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