Acala, a decentralized finance network powering the crypto-backed aUSD stablecoin ecosystem, is “ready to resume operations,” the platform announced on Friday.
In August, the Acala community voted to suspend network operations after a USD breach led to the stablecoin being depegged.
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Acala ‘ready’ after USD failure mint
An error in minting the token that serves as the native stablecoin on Polkadot had resulted in more than aUSD 3 billion being incorrectly minted – with the incident prompting action by the liquidity provider that eventually helped depegge the decentralized stablecoin.
The community quickly passed various governance votes to pause multiple operations including DEX, Incentives Palette, Oracle Palette, Redeem, and Non-ACA Token Transfers.
But today, the Acala team said the network is ready to resume operations. Acala co-founder and COO Bette Chen wrote in a Medium post:
“Since the Acala aUSD Error Mint incident on 08/14/2022 … a number of community governance votes have taken place such that all liquidity pools are now recapitalized and rebalanced and all aUSD outstanding are now fully collateralised. The Acala network is in a state where it is ready to resume operations.”
Crypto market conditions and prices have changed significantly since the incident and the Acala team is aware of the impact this could have on liquidity providers. Therefore, it is recommended to resume grid operation in three phases:
Phase 1 will allow LPs to withdraw from pools while Phase 2 will allow all operations such as trades, incentive pallets and LDOT instant redemptions. Oracles are then activated in phase 3.
We therefore recommend a step-by-step approach when resuming operations 👇
Phase 1: LPs allow liquidity to be taken from pools
Stage 2: Activate remaining Operations except Oracles
Phase 3: Activate Oracle
— Acala (@AcalaNetwork) September 22, 2022
The Acala Foundation says it is still working with law enforcement and other partners as it attempts to recover any aUSD and swapped tokens resulting from the flawed mints.
A 5% bounty also remains in place for anyone returning funds that they may have received in error as a result of the exploit.
For now, and in view of resuming operations, the Foundation notes that some assets remain frozen on the chain following the community governance votes. There are also assets frozen in multiple CEXs.
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