Update on remediation funding process, details

The past few weeks have been challenging for all users and partners in the Raydium community.

Next steps for compensation

Following the initial funding remediation proposal, assets from the treasury have been used to acquire the vast majority of assets affected in the breach.

The next step is to use the acquired assets to restore the losses of users who had liquidity positions in the affected pools at the time of the incident.

Below is the plan to advance and compensate users.

asset allocation process

There will be a claims portal page on the Raydium user interface where users can view information on affected liquidity positions and withdraw corresponding assets for compensation.

Claims will be processed in two phases and split between specific pools of funds. The phased allocation of funds is an additional security measure that effectively limits the amount of assets that the claims portal page can hold at any given time.

The allocation will be carried out in two phases

The first phase is open to users who have personal liquidity positions on Raydium. Specifically, this means that individual liquidity providers (LPs) directly make LPs or stake in the mining pool on Raydium.

Timeline. The claims portal is expected to be live at 12:00 UTC on January 5 (20:00 Beijing Time on January 5) for the first phase of allocation. The claims portal will remain open for two months and will be accessible until March 5, 2023.

Claims for the following currency pairs will be open in the first phase.

  • SOL-USDC

  • RAY-USDC

  • RAY-SOL

  • RAY-USDT

  • SOL-USDT

  • stSOL-USDC

  • whETH-USDC

The second phase will follow the first phase, and more details will take some time to work out.

  • It is worth noting that third-party protocols and strategic vaults are not included in Phase 1. Strategic vaults, such as the automatic reinvestment vault, require users to deposit LP tokens in their PDA accounts, which means that Raydium’s snapshot can only attribute LP tokens deposited in the strategic vault to one “owner”, or the address of a third-party protocol.

  • Raydium does not intend to discriminate against third-party protocols, but requires affected protocols to upload available snapshot data to Raydium’s github and detail how they will allocate funds on the forum.

  • Claims on liquidity positions in the ZBC-USDC and UXP-USDC pools will be distributed in the second phase.

  • Raydium intends to open claims to third-party protocol “owners” in Phase 2. The list of positions awaiting additional information from third-party platforms is below.

    Phase I compensation details

    In the event, liquidity providers’ (LPs) asset claims will be divided into three categories.

    1. For RAY-USDC, RAY-SOL, and RAY-USDT, liquidity providers will be able to claim 100% of the original principal loss for each individual position based on a snapshot of the LP balance at the time of the vulnerability.

    RAY used to cover original principal risk is allocated from the vested Raydium team token reserve.

    2. For SOL-USDC, SOL-USDT, stSOL-USDC, and ETH-USDC, individual liquidity positions will be able to claim 90% of the original principal lost by each individual position based on a snapshot of the LP balances at the time of the vulnerability.

    3. For SOL-USDC, SOL-USDT, stSOL-USDC, and ETH-USDC, individual liquidity positions will also be able to claim the remaining 10% of the lost asset value (at the time of the vulnerability) denominated in RAY. The remaining 20% ​​of the lost asset value denominated in RAY will be further added to the compensation. Therefore, for every $1 of original principal not included in the native asset, $1.2 worth of RAY, or a ratio of 1:1.2, will be used for compensation.

Additional RAY compensation will be distributed from the vested Raydium team token reserve.

RAY’s value is derived from 30-day time-weighted data from CoinMarketCap between December 6 and January 3. RAY’s 30-day TWAP price is $0.1813.

Key Takeaways

The first phase of distribution will be available through Raydium’s claims portal page, which is expected to go live at 12:00 UTC on January 5 (20:00 Beijing time on January 5) and will last for 2 months until March 5.