A new proposal at Balancer’s governance forum sets the stage for how the protocol plans to approach the next phase of its recovery efforts.
Summary
- Balancer has proposed a framework to distribute $8 million in rescued assets following the V2 exploit.
- Whitehats would receive 10% premiums, while LP reimbursements would be prorated and paid in kind.
- The November 3 attack cost more than $128 million, prompting coordinated recovery operations and mitigation efforts across the community.
Balancer has outlined a repayment plan that would return approximately $8 million in rescued assets to liquidity providers affected during the v2 exploit.
The 27th of November proposal is the protocol’s first concrete step toward settling losses following one of the largest breaches of the decentralized finance sector this year.
How the repayment plan would work
The proposal outlines how funds recovered by white hat responders and internal rescue teams will be distributed. According to Balancer (BAL), $8 million was secured on various networks after the exploit, while another $19.7 million tied to osETH and osGNO is being processed separately by StakeWise.
Under the plan, whitehat actors who intervened during the attack would receive bounties equal to 10% of the assets they helped recover, paid in the same tokens they returned.
Balancer’s Safe Harbor agreement requires full identity verification, KYC screening and sanctions checks before making withdrawals. The foundation has already approved the compliance of the whitehats involved, although their identities remain confidential.
The proposal also outlines how internally recovered funds, secured in partnership with Certora, will be handled. Because Certora was operating under an ongoing service agreement, these chargebacks are outside the incentive program. Instead, the tokens are returned directly to the relevant pools.
Liquidity providers would receive refunds on a pro-rata basis, tailored to their BPT holdings in snapshot blocks taken just before the first operating transactions on each network.
The distribution would be unsocialized, meaning that the assets recovered from each pool would only go to LPs in that same pool. Payments would also be made in kind, giving users the same tokens that were rescued.
A claims interface will be built and users will need to agree to Balancer’s terms before receiving any funds. Any unclaimed assets after the claim window closes will be diverted via a later board vote.
A look back at the November exploit
The November 3 attack cost over $128 million on Ethereum and multiple layer 2 networks, exploiting a precision loss flaw in Balancer’s v2 pool invariant. The attacker manipulated the token balances, creating a loop of profitable arbitrage that emptied the pools in just a few minutes.
While most stolen assets were quickly moved through mixers, coordinated white hat responses and protocol-level interventions prevented deeper losses. StakeWise recovered approximately $19 million worth of osETH shortly after the incident, and Balancer paused the affected pools to limit further damage.
The new repayment plan is now under community review, bringing the next board vote as Balancer works to close one of 2025’s most disruptive chapters.
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