The Sui-based DeFi platform, Nemo protocol, has introduced a compensation plan for the affected users in the recent $2.4 million hack. The platform is planning to issue NEOM tokens equal to the value of their losses in USD to compensate.
In a blog post on Sunday, Nemo explained that it adopted a debt token strategy instead of paying in USD because the company does not have sufficient funds or capital to offer all the affected users. But the company will ensure that every user gets NEOM equal to the full amount of their original losses from this security incident.
Nemo wrote, “Our goal is to make every user whole by issuing a debt token equal to their loss in USD, with the understanding that its value may change over time depending on market conditions and the progress of fund recovery.”
Moreover, Nemo is also making sure that all calculations of $2.4 million loss, token distributions, and use of funds are conducted with high transparency and fairness.
It has introduced a three-path recovery method for users to claim their lost assets.
According to the blog, one $NEOM will be minted for every $1.00 of confirmed loss, based on the pre-hack snapshot. The company is poised to reimburse with complete transparency. It said, “To ensure full transparency, we will establish a dedicated website to track the NEOM burn progress, allowing the community to monitor real-time updates on the initiative.”
Nemo also revealed that it is planning to make a 100% deposit for recovered funds from the hacker into a new, multi-party managed “Redemption Pool.” It will allow NEOM holders to claim their share, based on how much they hold.
The NEOM token is a debt token issued by Nemo Protocol to fully compensate users for their losses, valued at $1 per token, following a recent security incident.
Nemo will issue NEOM tokens equal to the full USD value of each user’s confirmed losses, based on a pre-hack snapshot, to make all affected users whole.
Holders can either sell their NEOM tokens immediately or hold them to potentially claim a share of any future funds recovered from the hacker via a dedicated redemption pool.
The value of NEOM may change over time based on market conditions and the success of Nemo’s ongoing efforts to recover the stolen funds from the hacker.
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