V1 Exploit Compensation Plan
To fairly reimburse early adopters who personally covered losses from the V1 exploit, we have established a Compensation Pool worth US$20,380. The allocation is proportional to the actual loss each user incurred, and includes a modest interest adjustment to account for the opportunity cost during this period.
Compensation Method
compensation will be paid using stablecoins and ETH generated from protocol fees and revenue, rather than $ZAP tokens. This approach:
- Preserves $ZAP token value by avoiding token dumps for compensation
- Uses sustainable protocol-generated revenue (stablecoins/ETH)
- Ensures fair compensation without negatively impacting token holders
Impact on Token Buybacks
Note: This compensation method will temporarily slow down the $ZAP token buyback program, as a portion of protocol revenue will be allocated to V1 exploit compensation instead of token buybacks. Once compensation is complete, the full protocol revenue will resume supporting token buybacks.
Compensation Details
| Recipient | Covered Loss | Payment Schedule |
|---|---|---|
| Eugene Chang | 5 ETH (≈ $15,000) | Paid from protocol revenue over 12 months |
| Adrian Wu | $5,380 | Paid from protocol revenue over 12 months |
Total Compensation Pool: $20,380 in stablecoins/ETH from protocol fees
Payment Source: Protocol-generated fees and revenue (stablecoins, ETH)
Payment Method: Monthly distributions over 12 months starting from protocol revenue generation
Interest Rate: Modest interest adjustment applied based on project's financial capacity