Fei Labs Submits Proposal To Remove Governance Powers From Tribe DAO

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Fei Labs' proposal reads: "Logically distributing DAO assets and removing governance is a responsible direction which closes many of the risks and challenges the Tribe DAO has faced."

Fei protocol submits a proposal titled "TIP-121" that seeks to redistribute Tribe DAO's assets and strip the DAO of its governance powers in light of Rari Capital's Fuse hack in April 2022.

Earlier this year, Rari Capital was targeted by a re-entrancy exploit that allowed the hackers to issue flash loans in USDC and wETH and immediately repay them by withdrawing the collateral using the exitMarket smart contract function. After repeating the process several times, the perpetrators escaped with $80M stolen from Rari Fuse users who had loaned their assets.  

Following the attack, Fei Protocol offered the hackers a $10M bounty in exchange for returning $80M worth of stolen assets. However, the hackers did not respond to the tweet.

In the aftermath of the hacking attack, Fei Labs came up with a proposal to reimburse the Rari Fuse victims. The proposal highlights three components:

  • Consolidation of the DAO’s remaining assets.
  • Repayment to Fuse hack victims.
  • Converting FEI into wrapped TRIBE, redeemable in a 1:1 ratio.

Fei Labs claims the three steps would each be snapshotted independently "to build non-bidding consensus."

Beginning August 22, Fei Protocol will snapshot the crucial processes involved in the consolidation step, including converting LUSD and ETH into DAI. The firm claims that if the DAO approves the snapshots of the remaining steps, it will take around two months to finish security audits and remaining developments before the final on-chain voting can commence.

Lastly, Fei Protocol states that upon completion of the proposal, Fei Labs will cease to participate in the Tribe DAO, "irrespective of whether the individual pieces fail or succeed."

Written by
Ayush Pande
Fei Labs' proposal reads: "Logically distributing DAO assets and removing governance is a responsible direction which closes many of the risks and challenges the Tribe DAO has faced."

Fei protocol submits a proposal titled "TIP-121" that seeks to redistribute Tribe DAO's assets and strip the DAO of its governance powers in light of Rari Capital's Fuse hack in April 2022.

Earlier this year, Rari Capital was targeted by a re-entrancy exploit that allowed the hackers to issue flash loans in USDC and wETH and immediately repay them by withdrawing the collateral using the exitMarket smart contract function. After repeating the process several times, the perpetrators escaped with $80M stolen from Rari Fuse users who had loaned their assets.  

Following the attack, Fei Protocol offered the hackers a $10M bounty in exchange for returning $80M worth of stolen assets. However, the hackers did not respond to the tweet.

In the aftermath of the hacking attack, Fei Labs came up with a proposal to reimburse the Rari Fuse victims. The proposal highlights three components:

  • Consolidation of the DAO’s remaining assets.
  • Repayment to Fuse hack victims.
  • Converting FEI into wrapped TRIBE, redeemable in a 1:1 ratio.

Fei Labs claims the three steps would each be snapshotted independently "to build non-bidding consensus."

Beginning August 22, Fei Protocol will snapshot the crucial processes involved in the consolidation step, including converting LUSD and ETH into DAI. The firm claims that if the DAO approves the snapshots of the remaining steps, it will take around two months to finish security audits and remaining developments before the final on-chain voting can commence.

Lastly, Fei Protocol states that upon completion of the proposal, Fei Labs will cease to participate in the Tribe DAO, "irrespective of whether the individual pieces fail or succeed."

Written by
Ayush Pande