Nemo Protocol Launches Debt Token Plan to Compensate $2.6M Hack Victims

Sui-based yield trading platform Nemo Protocol has unveiled a debt token compensation program for users impacted by a $2.59 million exploit on September 7. The breach stemmed from an unaudited code change, leaving the system vulnerable.

The recovery plan, outlined in a Sunday blog post, involves issuing NEOM debt tokens pegged 1:1 to users' losses in USD terms. A dedicated redemption pool—funded by recovered assets, liquidity loans, and investments—will facilitate repayments over time. "While we WOULD have preferred direct USD reimbursement, our financial constraints necessitated this approach," the team stated.

Phase one allows users to reclaim residual value from compromised pools via a one-click migration to audited smart contracts. Phase two distributes NEOM tokens, while phase three details remain pending. The protocol emphasized multi-audited contracts for the new system.