Layer 2 scaling solution Metis has announced a plan to compensate users affected by last month’s PolyNetwork bridge hack.
The project will distribute 117,000 METIS tokens to impacted community members. At the same time, Metis is implementing an enhanced cross-chain architecture using LayerZero’s OFT model.
Recapping The PolyNetwork Exploit
On July 1st, a hacker exploited the PolyNetwork bridge to mint and drain liquidity pools of 8.8 million METIS tokens on Binance Smart Chain. Metis responded quickly by removing liquidity from PancakeSwap, Stargate, and other DEXes to limit the damage. This left the hacker only able to steal 117,000 METIS from users.
The exploit did not impact the total or circulating supply of METIS on Ethereum or Metis. However, BSC users were affected due to the lack of liquidity for swapping or trading after the hack. To make these users whole, Metis will distribute 117,000 newly created rMETIS tokens.
Compensation Via Vested Token Model
The rMETIS tokens represent a receipt for the 117,000 METIS allocated for compensation. The rMETIS will vest over time, starting at a 1:0.5 ratio to METIS on September 14th, 2023. The ratio will gradually increase until full 1:1 parity after September 14th, 2024.
Affected users can claim rMETIS until October 14th, 2024 and redeem at any point for the METIS amount relative to the vesting schedule. This model balances compensation for unaffected users and restoration for affected community members.
OFT Structure Provides Superior Cross-Chain Experience
Previously, METIS tokens on networks besides Ethereum and Metis were wrapped versions with inferior security assumptions. To improve the cross-chain experience, Metis has upgraded to LayerZero’s OFT architecture.
OFT enables real METIS tokens on BNB Chain, Avalanche, and other chains. Users can earn native METIS rewards by supplying assets to “USDT by Metis” pools on BNB Chain for example. This also enables seamless Metis bridging without liquidity pool requirements.
The initial DEXes to offer trading in native Metis OFT tokens include Hermes, Unimaia, Hummus, Netswap, and Hera. Overall, the OFT structure unlocks superior cross-chain operability for the Metis ecosystem.
Metis Takes Action To Support Users And Improve Decentralized Ecosystems
Metis has taken decisive action to support users affected by the PolyNetwork exploit while also improving the cross-chain operability of its ecosystem. The vesting token model provides responsible compensation to impacted community members.
At the same time, the transition to LayerZero’s OFT architecture enables a superior experience for METIS holders across multiple blockchains. With these efforts, Metis continues working towards its goal of bridging Web2 and Web3 and enabling the next generation of decentralized applications.
This article is strictly for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. CryptosOnline.com does not provide investment, tax, legal, business or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any loss or damage caused or alleged to be caused by, or in connection with, the use of or reliance on any content, goods, services or opinions mentioned in this article.
#Bitcoin #Cryptocurrency #Crypto