Balancer’s $1.4M ETH recovery plan awaits vote

Balancer DAO posted a Sept. 18 proposal to allocate 296.401711 ETH returned after an Aug. 31 exploit among liquidity providers in 120 Balancer V1 pools. The proposal would use a single pre-attack snapshot at Ethereum block 25,872,248 to determine individual claims.

Under the plan, recovered ETH would first be allocated to each pool according to that pool’s share of the total dollar loss at the time of the attack. Each pool’s allocation would then be divided among liquidity providers based on their pool-token holdings recorded at block 25,872,248, which immediately preceded the first exploit transaction at block 25,872,249. One snapshot is intended to cover all 120 legacy pools, including some later targeted by copycat activity.

The proposal lists five ETH transfers returning funds to the Balancer multisig between Sept. 8 and Sept. 16 from one main greyhat, three anonymous whitehats and block builder Ultrasound.money. At attack-time prices the protocol recorded about $1.39 million drained from the pools. The recovery pool is denominated in ETH; the proposal records 296.401711 ETH returned but does not state a recovery percentage comparing that ETH to the dollar-denominated loss.

Key allocation files are not yet public. The Sept. 18 post does not include the per-pool allocation table, token holder lists or per-address claim amounts, so individual liquidity providers cannot calculate exact ETH payouts. The post remains labeled BIP-XXX and contains no Snapshot vote link. It says claim data and a claim mechanism will be published only if the proposal passes. The V1 claim window is not open and no start or end dates have been announced.

Receivers would need to provide digital consent releasing Balancer Labs, Balancer DAO, Balancer Foundation, affiliated parties and service providers from liabilities related to the incident. The proposal states that payments would be made in ETH. Contract and multisig claims would be handled on a case-by-case basis.

The recovery pool is separate from assets covered by Balancer’s proposed wind-down framework. That framework treats funds recovered from protocol attacks as belonging to affected liquidity providers and distinct from the treasury distribution intended for BAL holders.

Until a Snapshot vote occurs and Balancer publishes per-pool and per-address allocations, payments cannot be calculated or distributed. Liquidity providers and other stakeholders must wait for the vote and the release of address-level data before determining individual recoveries.