Why is Insurance withdrawals even discussed by DAO? This fund was created to cover market/trading risk not team exploits.
The Insurance Fund was not affected by the exploit. The notional value of the assets in Insurance Fund before the attack is approximately $20M
Release of the funds in the Insurance Fund is dependent on a governance proposal and subsequent DAO voting.
To contribute to the outcome of the funds, participate in governance to determine whether the funds will be available to depositors or added to the recovery pool.
Users’ portion of the insurance fund should not even be up for consideration. However, there is a big chunk that is not user owned, I took a look on-chain at least 8M of the 20M was not users’ shares and therefore protocol owned. We should definitely discuss on using some/all of it for the recovery pool
A DAO vote will not protect the team from committing money laundering. The only legal option open to the team is to return the IF to the holders. Anything else is a breach of contract and a criminal act.
IF stakers accepted the specific risk of backstopping trading losses, not multisig compromise, infected devices, malicious repos, or operational failures.
Drift first said the IF was unaffected and depositors’ assets remained intact. Now it is pushing the decision to the DAO: return the IF or redirect it to recovery.
That looks like shifting responsibility for taking unaffected, purpose-specific user funds onto governance after the fact.
The IF should be returned pro-rata or reinstated under its original terms. DAO governance must not be used to confiscate defined-purpose user deposits.
Agree 100% - you cannot legally ask non contributors to a fund if they want a share of it. It should be screamingly obvious that is fraud from the outset. I am shocked that supposedly intelligent people even proposed it!