By Michael Scott
The decision by Euler Finance to distribute the funds returned by the exploiter to its users is attracting attention from Nexus Mutual members. The aggrieved members allege that Nexus Mutual should receive the recovered proceeds as it already paid victims of the hack who were policyholders.
Nexus Mutual Members Devoted to Recover Refunds in Euler Claims
In support, Nexus Mutual executives revealed plans to pursue a refund from policyholders who filed claims for incurring losses during the March 13 $200 million hack. The members argue that the exploiter voluntarily returned nearly all the proceeds. It implies that the settlement made by Nexus Mutual to cover losses that ultimately did not occur.
The dispute involves Nexus Mutual as one of the leading insurance platforms that cover decentralized finance deposits, despite being a high-risk undertaking. The insurer members demand a refund from five clients who previously filed claims following the March incident.
Nexus Mutual claims that the five users account for $2 million crypto translating to 83% of the $2.4 million settlement. The revelation that only six users from over 500 sought insurance for their investment affirm that most DeFi parts rely solely on trust. Most users dismiss the warning issued by crypto proponents that craft code could disrupt the entire project, resulting in unrecoverable loss of digital wealth.
Policy Beneficiaries Disguise their Dishonesty Despite Receiving Compensation
Meanwhile, Euler Finance continues registering higher redemptions, with over 539 users receiving $142.21 million at 14:01 UTC. An estimated six users are policyholders who claimed the losses from Nexus Mutual. Two policy beneficiaries show no trace of either chain swapping the redeemed amount.
The head of communications at Nexus Mutual indicated that the money claimed from the users belongs to the insurer. The executive restated that the holders committed to remit the value of claims that Euler Finance would refund as such belonged to Nexus Mutual.
Nexus Mutual members hold that the situation is fulfilled. The Euler hacker returned the exploit, enabling users to redeem their claims, including those settled by Nexus Mutual.
Nexus Mutual Likely to Pursue Dishonest Claimants
The communication director at Nexus Mutual acknowledged that the return of the exploit was the pioneer claim event for any protocol to recoup lost funds. BraveNewDeFi added that one policyholder traded 200 ETH despite the proceeds belonging to Nexus Mutual. The amount lost exceeded $380000, with the address owner becoming unresponsive to prompts. Others have yet to redeem with the protocol or have paid the value of the claim compensated by Nexus Mutual.
The loss of a six-figure payout is immaterial to Nexus, given its solid financial health. Besides, Nexus offers the strongest coverage to DeFi relative to the loss ratio.
Richard Chen from the crypto venture 1confirmation reveals that Nexus Mutual commands the health insurance business, given its strong coverage relative to the loss ratio. The general partner at the firm lauded the efforts by the Nexus Mutual team to prevent the loss of a recoverable penny.
The statement by Nexus Mutual confirmed contacting Euler and urging it to integrate notice within the claims portal to alert policyholders on money owed. The team stated that failure for the approach to bear fruits would necessitate initiating lawsuits.
Euler Opens Redemptions
Hugh Karp, the founder of Nexus Mutual protocol, indicated the DAO members could utilize their connections with legal professionals and pursue the claimants for dishonesty. He added that four of the nine returned the funds and that engaging legal counsel would only arise when pursuing remaining claims.
Elsewhere, Euler Finance confirmed opening redemptions following the return of most stolen assets. A recent update conveyed on April 12 by the Ethereum-based noncustodial protocol confirmed Euler would repay the sub-account liabilities affected by the March 13 loan attack.
Euler Finance confirmed establishing a smart contract to ensure safe custody of funds owed to the exploited addresses. The protocol integrates Merkle Tree, requiring users to validate their addresses before the token computation. Its inclusion would help the account holder confirm to abide by the terms and conditions.