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Terra Classic (LUNC) validator TerraCVita recently disclosed that they had finalized the package for the compensation of the victims of the 2023 Terraport hack.
TerraCVita disclosed this in a recent post on X after months of discussions surrounding the compensation idea. According to the post, the TerraCVita team has finalized the compensation package to repay the victims of the April 2023 hack, which resulted in the loss of $4 million worth of assets.
Last week, the team revealed that it was looking to release a proposal geared toward compensating the victims. TerraCVita has carefully chosen to call the campaign a compensation and not a refund, arguing that the funds were not particularly stolen by Terraport in the first place.
Speaking on the latest development, Rexyz, the TerraCVita lead, emphasized that the compensation package would mark a pivotal achievement for the Terraport team, and could help bolster its reach.
This will be a massive achievement for the @TerracVita team building @_Terraport_ and impact the whole community.
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Already under massive demand, once the shackles are removed and the full power of Terraport is released there will be no stopping the #TerraClassic community's… https://t.co/DjC1xUu2aG— Rexyz (@RexYellerBelly) March 19, 2024
Before the remarks on X, the Terraport team had already spotlighted the compensation idea in a documentation, prompting discussions within the Terraport Telegram channel. One of the avenues through which they wish to generate funds is raising fees on the Terra Classic-based Terraport DEX.
Rexyz stressed in the Telegram channel that this approach would have a negative impact on the price of TERRA, the native token of the Terraport ecosystem, as the higher fees would make Terraport less competitive when compared to other decentralized exchanges with less fees.
However, he confirmed that the team would still go through with this approach, but the compensation plan could be bolstered by a rise in TERRA’s price. As of press time, TERRA changes hands at $0.0259 amid a 33% decline over the past 30 days, per data from CoinGecko.
The Terraport Hack
Recall that the Terraport hack, which occurred last April, affected the project’s liquidity providers (LPs), with separate reports pegging the total loss at $4 million. The perpetrators laundered the funds through multiple centralized exchanges, including MEXC, KuCoin and Binance.
Some of these exchanges froze the assets with the help of investigative efforts from community members. In addition, the team engaged law enforcement. The TerraCVita team launched a proposal to lock up $2 million of the stolen funds traced on-chain. However, the community voted against this move.
Nonetheless, some liquidity providers have already reported the case to the authorities and are collaborating in fund recovery. Shortly after the hack incident, Terraport relaunched on Terra Classic and secured a Certik audit.
Nearly a year after the hack, the Terraport team is now looking to compensate the victims to the best of their ability. Nonetheless, details remain scant, and there is no guarantee that the compensation would be a full one.
In one of his recent statements, Rexyz noted that the team would prioritize individuals that have reported to the authorities and are assisting with recovery efforts. Some community figures have proposed plans for the compensation, but there are no details on the agreed plan as of press time.
