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Mango Market's DAO Forum Approves $47 Million Settlement With Hacker

Mango Market’s DAO forum is likely to approve a $47M settlement with a hacker. Over 98% of voting tokens support the deal, which also states that Mango Markets will not seek criminal charges.

15-Oct-2022 By: Ashish Sarswat
Mango Market's DAO F

According to the decentralized finance (DeFI) protocol 

Governance forum, following a $117 million exploit on Oct. 11, the Mango Markets community is prepared to reach a deal with its hacker, enabling the hacker to keep $47 million as a bug bounty.

The proposed terms reveal that $67 million of the stolen tokens would be restored, while the hacker will keep $47 million. The arrangement was approved by 98% of voters, or 291 million tokens, and stipulates that Mango Markets would not seek criminal charges in the matter.

With the quorum secured, voting is expected to take place on October 15. According to the proposal, “the funds sent by you and the mango DAO treasury would be utilized to pay any outstanding bad debt in the protocol. All mango depositors will be compensated. By voting for this proposal, mango token holders agree to pay off the bad debt with the treasury, waive any prospective claims against accounts with bad debt, and agree not to pursue any criminal investigations or fund freezing until the tokens are restored as mentioned above.”

The proposal was also questioned during the governance forum, as per one voter: “I completely agree that returning consumers' funds whole as soon as possible is the first concern, but a $50 million "bug bounty" is ridiculous. At most, the exploiter should get their expenses plus $10 million. The $600 million wormhole hacker was promised a $10 million white hat bounty. Mango can do better than this, especially since the exploiter has been doxed.”

The hacker carried out the attack by manipulating the value of the MNGO native token collateral, after which he took out "large loans" from Mango's treasury. After draining the funds, the hacker requested a settlement, writing up a proposal on the Mango Market's decentralized autonomous organization (DAO) forum at the time, asking for $70 million.

Furthermore, the hacker voted for this proposal using millions of tokens obtained through the attack. On October 14, the proposal received the necessary quorum to pass. In exchange for the settlement, the hacker wants that users who vote in favor of the plan agree to pay the reward, settle the bad debt with the treasury, waive any prospective claims against accounts with bad debt, and refrain from engaging in any criminal investigation or freezing of funds.

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