Layer-1 blockchain Concord has proposed to mint billions of its ONE tokens as a way to reimburse the victims of the Horizon bridge hack that noticed round USD 100m of consumer funds stolen.
The Concord blockchain must onerous fork and improve the availability of ONE to mint new tokens. The workforce stated reimbursement could be within the type of ONE tokens and span a three-year interval because of the treasury’s restricted potential to supply fast reimbursement.
In a weblog publish, the Concord workforce put ahead two working choices and requested for the group’s suggestions.
The primary possibility is “an estimated 100% reimbursement” that proposes minting ONE 4.97bn, which equates to a 3-year month-to-month emission of 138m tokens, or round USD 2.76m, utilizing the token worth of USD 0.020, they stated.
The second possibility is “an estimated 50% reimbursement” that implies minting ONE 2.48bn over a three-year interval, which translated right into a month-to-month emission of 69m tokens, value round USD 1.38m utilizing the token worth of USD 0.020.
“The quantity of ONE distributed might be based mostly on the USD worth of tokens misplaced throughout impacted wallets from the time we carry out a snapshot,” the workforce stated.
They added that, from the snapshot ahead, the distributions might be made based mostly on the variety of pre-calculated ONE tokens, not based mostly on their fiat-currency worth.
Because of this affected customers would obtain a certain quantity of ONE based mostly on the snapshot disregarding the token’s worth. Some customers argued that this “does not make sense,” suggesting that it ought to change based mostly on market worth.
“The reimbursement needs to be at the least based mostly on present market worth every month and never .02. So if One goes to [USD] 1. You simply reimbursed [USD] 4 billion+ to people who misplaced [USD] 100 million,” one consumer stated, whereas one other wasn’t as optimistic in regards to the worth, saying: “if ONE goes to [USD] 1 I am going to provide you with my mom.”
Many customers, nevertheless, criticized the workforce for eager to “print cash” out of skinny air, arguing that they might be driving the worth down for others locally as “extra provide often means decrease costs.”
Arpit Sharma, one other group member, famous that minting billions of latest tokens may crash the worth of ONE.
Some customers additionally criticized the workforce’s choice to not use treasury funds. “So your letting the traders/customers pay the depegged and reimbursement? This may destroy the chain and traders will decide out not ready for that period of time,” one Twitter consumer stated.
Nevertheless, the workforce stated that they determined towards utilizing the treasury “within the curiosity of the longevity and wellbeing of the undertaking as reimbursing from the treasury would significantly hinder the muse’s potential to help the expansion of Concord and its ecosystem.”
As reported, in late June, a hacker exploited a vulnerability in Concord’s Horizon Bridge, which permits token transfers between the Concord community and Ethereum (ETH), Binance Chain (BNB), and Bitcoin (BTC), to steal USD 100m value of various crypto property in late June.
At 7:41 UTC on Wednesday morning, ONE was buying and selling at USD 0.0198, down 2.5% in a day and 23.5% in every week. It additionally dropped 14% in a month and 95% from its all-time excessive recorded in October 2021.