The Aave community governance page shows that some users have proposed a joint recovery plan between Aave and Harmony to compensate for the loss of user funds on AAVE after the Harmony blockchain was hacked. The core part of the recovery plan is the establishment of a recovery fund, with Harmony and Aave each contributing 10% of the total necessary reimbursement funds. It will enable affected users to immediately recover 20% of their pre-hacker balances, providing some immediate relief and laying the foundation for further recovery efforts. Part of Aave's contribution will come from writing off its currently depreciated assets held in the Harmony DAO treasury, which includes approximately 2 million aONE and 700 aLINK tokens. The rest of the contributions from both parties may come from their respective reserves or other sources of funds.
The proposal also introduces the Decaying oracle mechanism proposed by service provider BGD, which will start with a 20% recovery rate and then gradually decrease, clearing the decoupled assets as early as possible in a gradually depreciating manner. If there is any remaining bad debt, the debt will be divided equally between Harmony and Aave. The recovery process is expected to take about four years.
