Balancer has outlined a recovery plan to distribute 296.401711 ETH among liquidity providers in 120 legacy pools following an August 31 exploit that drained tokens valued at approximately $1.39 million at the time of the attack. However, the proposal remains in limbo as it awaits a governance vote and the release of detailed claim information.
The recovery ETH was returned to the Balancer DAO Multisig between September 8 and September 16 by a main greyhat, three anonymous whitehats, and block builder Ultrasound.money. The 296.401711 ETH figure represents the amount recovered to date, not a guarantee of full reimbursement for all losses.
How the Allocation Would Work
Under the proposal, Balancer would first allocate recovered ETH to each pool based on that pool's share of total dollar losses at the time of the attack. The protocol would then distribute each pool's allocation among liquidity providers according to their pool-token holdings at Ethereum block 25,872,248, the block immediately before the first exploit transaction.
Using a single pre-attack snapshot would cover all 120 pools, including those later targeted by copycat activity.
Key Barriers to Payment
No claim window is currently open. As of September 20, the proposal remained unlabeled and contained no Snapshot vote link. Claim data and a claim mechanism would only be published and deployed if the proposal passes a governance vote.
Until address-level allocation tables and per-address payout amounts are published, individual liquidity providers cannot calculate their exact ETH allocation. The proposal also includes a legal requirement: claimants would need to provide digital consent releasing Balancer Labs, Balancer DAO, Balancer Foundation, and affiliated parties from liabilities related to the exploit.
Payments would be made in ETH, while contract and multisig claims would be handled on a case-by-case basis.
Separation from DAO Treasury
The recovery fund is kept separate from assets covered by Balancer's proposed protocol shutdown. This distinction ensures recovered exploit funds are reserved for affected liquidity providers rather than distributed to BAL token holders through treasury allocations.
