In a recent report, KyberSwap revealed plans to downsize following the multi-million dollar exploit that plunged the company into financial woes. The report demonstrated that the Singapore-based decentralized finance protocol will reduce 50% of the workforce to remain afloat.
A statement from KyberSwap chief executive Victor Tran demonstrated that the expected layoffs were among the difficult decisions the company has made.
The executive described the headcount reduction as a heart-wrenching event since the KyberSwap core team was affected by the layoff.
KyberSwap Announce 50% Headcount Reduction
In support of the departing team, the KyberSwap team created a voluntary database that allows the affected employees to seek for employment in other Web3-oriented platforms.
The CEO confessed that the company plans to halt some of the business operations besides the layoffs. He regretted that the slow rate of capital expenditure forced the KyberSwap team to halt the liquidity protocol and ongoing KyberAI initiatives.
Despite the suspension of the KyberSwap projects, the executive confessed that the company would focus on running its core businesses, including the Limit Order functions and the Aggregator protocol.
The CEO confirmed that the KyberSwap team would proceed with the development of the Zap API, which seeks to support the Dapps and wallets. Tran anticipates that Zap API will go live soon to provide users with a convenient platform to access DeFi liquidity protocols.
Impact of KyberSwap $49M Exploit
With the ongoing development, the KyberSwap plans to compensate the customers affected by the $49 million exploit. The KyberSwap team has created the Treasury Grant Program to facilitate the reimbursement of funds to the affected customers.
Also, the DeFi platform confirmed that the expected compensation plan will kick off on February 1, 2024. The KyberSwap team recently outlined the procedure for the repayment of funds.
In the report, the KyberSwap team encouraged the affected customers to register for the reimbursement plan. The registration process will run from January 11 to January 23 next year.
After the attack, the KyberSwap team has been holding intense discussions concerning the reimbursement plans. At the meeting, the DeFi protocol developed a reference value of $49 million to support the reimbursement of funds to the affected customers. The report demonstrated that the user will receive 60% of the value.
Besides the proposed reimbursement plan, the KyberSwap team has in contact with the attackers. However the effort to return the stolen funds proved futile after the attackers rejected the bounty deal.
Rise of Crypto Crimes
The report demonstrated that the attackers demanded complete control of the KyberSwap assets, including the KyberDAO and governance tools. In the previous information, the hackers offered a deal to purchase KyberSwap at a fair value.
In retaliation to the request, the KyberSwap team assumed that the purchase offer provided by the attackers was a trick and rejected the offer.
A review of November 22 demonstrated that the hackers used an “infinite money glitch” to exploit the KyberSwap protocol. The probing team noted that the hackers leveraged their expertise to exploit KyberSwap’s smart contract where the company stores customers funds.
Reportedly the KyberSwap attack was among the most sophisticated exploits in the DeFi sector. According to the DefiLlama report, the hackers heisted approximately $290 million from the DeFi platform in November. The DefiLlama team noted that in 2023, around $1.2 billion was lost in hacking activities.
