OptionRoom’s response to the ChainSwap hack explained

As our recovery and restitution from the ChainSwap hack progress well, and a full and final resolution to the situation seems very near at hand, we thought this would be a good opportunity to provide a post-mortem on our response, to give our community full visibility and transparency over the actions we took, the motivations behind these, and why it was the best possible course of action to take in an otherwise unfortunate situation.

Firstly, it’s important to note that, due to the vigilance of our tech team, we were able to learn about the hack very promptly, before the hacker was actually able to sell any tokens. As such, swift and decisive action was required, in order to minimize the impending damage. In order to accomplish this, we had to remove liquidity from the DEXs we’re listed across, most notably Uniswap.

From the offset, our project’s mission, vision, and values have been ardently committed to the principles of decentralization. Because of this, our contracts don’t contain any code which would allow us to pause token transfers. We did however issue a warning to all token holders, which was sent out across all our channels, not to trade our ERC20 token, as our Uniswap liquidity pool was compromised.

A large majority of our liquidity on the DEX was from the community. A consequence of having a large number of token holders distributed across the globe is that we weren’t able to get every liquidity provider to withdraw their liquidity before the hacker sold the stolen tokens into the liquidity pool.

As such, we had no other way to withdraw and secure the community liquidity other than by selling into the pool. This enabled us to mitigate the financial damages of the hack, reducing a potential $800,000 loss into a $38,000 loss. All the funds recovered from the emergency actions we took were added back as liquidity on PancakeSwap, and all liquidity providers were recompensed directly to their wallets.

Unfortunately, there were a number of investors who saw the price drop in our token and decided to buy the dip, despite the warnings we issued across all of our channels not to do this. We’re unable to recompense these investors with new tokens, as this would harm investors who held our token pre-hack and who received our 1:1 airdrop; in this situation, we decided it wouldn’t be fair to our pre-hack investors and token holders if we airdropped the post-hack holders, as they would bear the brunt of the adverse ensuing price conditions.

We hope this announcement has gone some way in explaining the actions we took in the aftermath of the ChainSwap hack; these situations are incredibly difficult and challenging for everyone who they affect, from investors, token holders, and projects and teams themselves. We want nothing else apart from to make our community whole again, and we’re working hard around the clock to do everything we can to turn this situation around.

Thank you for reading, and for all your patience and support throughout this difficult period.

The OptionRoom Team