How Euler Finance Protocol Cover holders can prepare for claims filing


How Euler Finance Protocol Cover holders can prepare for claims filing

On Monday (13 March) at 8:50am UTC, Euler Finance suffered a $197m exploit of their permissionless lending market on Ethereum mainnet. The Euler team shared that they were working to mitigate the impact from the exploit on Twitter earlier today. 

Members who held active Euler Protocol Cover at the time the exploit occurred will be able to file a claim once the 72-hour cool down period passes, which will be on Thursday (16 March) at 8:50am UTC.

Protocol Cover

When you have crypto assets deposited in a protocol that is deployed on Ethereum, an EVM-compatible network, or an Ethereum Layer 2, Protocol Cover protects against the following risks: code being used in an unintended way (e.g., exploits, hacks); economic design failure; severe oracle failure; and governance attacks.

Excerpt from the Nexus Mutual Protocol Cover v1.0

You can read the full Protocol Cover wording for more information.

Nexus Mutual user interface (UI): scheduled downtime

As we shared in a recent announcement, the Nexus Mutual UI is offline for scheduled downtime as part of the Nexus Mutual V2 launch process. The UI will be back online and available for claims filing on Thursday (16 March).

Once Nexus Mutual V2 is live, we'll share an announcement on the Nexus Mutual blog and across our social media channels.

Claims Filing

Members can start to file their Euler Protocol Cover claims on Thursday (16 March) at 8:50am UTC.

You can check the Euler Finance Claims Tracker to see if your cover was active at the time withdrawals were halted.

If your Euler Protocol Cover is one of those listed as eligible, you’ll be able to file a claim.

When you are ready to file your claim, you can head to the Nexus Mutual user interface and begin the process. If you have any issues, you can head to the Nexus Mutual Discord, create a post in the DAO forums channel with the Claims and Euler Finance tags, and start a conversation.

You can review the Nexus Mutual V2 documentation to review the Protocol Cover claims process and the Claims Assessment process ahead of claims filing. 

Calculating your loss amount ahead of claims filing

When you file your claim, you will need to enter the requested claim amount on the Incident Details page. This will be your actual loss amount. If that amount is less than your total covered amount, you will be filing a partial claim.

To determine your loss amount, you will add up the values of your collateral assets (eTokens) and subtract the value of your borrowed assets (dTokens). Be sure to note any sub accounts if you have created sub accounts on Euler Finance. 

Total deposited - total borrowed = actual loss amount

If you have cover denominated in ETH, you can use the ETH values included in the Euler Finance Claims Tracker on the Crypto Asset Prices for Euler Claims tab. Those values were calculated using the price of the assets listed on Euler at the time just before the exploit occurred, or when the loss occurred.

Unfortunately, there is no sound way to determine the conversion rates for eTokens and dTokens. However, you should be able to connect your wallet to the Euler Finance user interface, go to the Account tab, and scroll down to the Operations table, which will show you your transaction records. You can export this information to csv.

You will be able to use those values to determine your loss. At this time, that is the most accurate way to calculate your loss amount.

If you need help calculating your loss or have questions about your loss amount ahead of claims filing, please reach out in the Euler Finance Claims Support channel in the Nexus Mutual Discord and request assistance.

Proof of loss

For Protocol Cover claims, you will need to prove that you lost funds due to the exploit by either:

  • Signing a message from the affected address during the claims filing process; or 
  • Sending a 0 value transaction from the affected address to prove you own and control the affected address

You will also be able to include written details, links to supporting documentation, and/or upload screenshots or other files in the Incident Details portion of the claim submission process.

What prevents claims assessors from denying my claim?

The claims assessment process is designed like an optimistic oracle, but instead of code, humans act as the oracles. The system is designed so that any attack would put more capital at risk than any potential profit that could be gained or any capital staked in risk assessment that could be saved.

Read more about the Fraudulent Votes section in the Nexus Mutual documentation.

You can also review the mutual’s claims history in the Nexus Mutual documentation and directly on-chain.

Claims support

If you have any questions about claims filing, proof of loss, or any other aspect of the upcoming claim event, please reach out in the Nexus Mutual Discord for support.