Summary
This proposal outlines the final steps for distributing funds to GLP holders affected by the previously disclosed vulnerability in the Arbitrum GMX V1 deployment. It seeks GMX DAO approval to allocate $500,000 from the Treasury to complete the agreed-upon GLV Retention Incentives distribution.
As most will be aware, the GLP funds were returned to the DAO following GMX’s outreach and negotiation. Following community and delegate feedback, there was clear support for a DAO contribution to make all affected GLP holders whole, and a desire for a quick resolution to the process. However, people’s preferences were split between distributing funds in stablecoins or in GLV tokens.
Subsequently, the DAO agreed on two key actions:
- A $2.0 million contribution to the recovered funds from the DAO Treasury
- A Snapshot vote to decide between the proposed distribution formats
After further discussion, the community voted to distribute GLV tokens and to allocate an additional $500K in GLV incentives to holders who fully retain their tokens for 3 months.
The GLV distribution process officially began on August 13th, and the three-month retention period concluded on November 13th. Therefore, a Snapshot has been taken at 8 PM UTC to identify the recipients eligible for the bonus incentive distribution.
If this Proposal passes, $500,000 from the Treasury will fund the distribution of GLV retention incentives to these eligible users. The Security Committee and core contributors will oversee the distribution process.
Distribution Overview
GLV Distribution + $500K Incentive
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The recovered funds were distributed in the form of GLV, ensuring that GLP users retained similar economic exposure (approximately 25% WBTC, 25% ETH, and 50% stablecoins) while recovering the value of their affected funds.
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The DAO contributed $2.0 million from the Treasury to help offset the shortfall caused by the security incident.
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An additional $500K in GLV has been allocated as a thank-you to users who supported GMX by holding all their GLV throughout the three-month period:
- $250K GLV [WETH-USDC]
- $250K GLV [BTC-USDC]
Eligibility Criteria:
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Wallets that claimed and continuously held their GLV through the three months are eligible.
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Wallets that have not yet claimed their allocated GLV are eligible.
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Eligibility applies only to wallets that claimed GLV directly in the GMX dApp.
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Approximately 500K GLP tokens were held in external protocols that had integrated with GLP. These protocols could choose between receiving GLV tokens directly or USDC/GM tokens as alternatives. Protocols that received GLV used various methods to distribute it: direct distribution to users, integration into updated vault structures, or conversion to other tokens for user distribution. GLV distributions to external protocols were excluded from bonus incentive calculations and are not automatically eligible for additional distributions. Protocol teams may contact Labs directly for case-by-case evaluation of potential supplementary distributions.
Rationale
This incentive distribution was established as part of the DAO-approved GLP Distribution Plan to recognize users who supported GMX and the DAO during the resolution process. It also ensures that affected users are made whole in a manner aligned with GLP’s original economic exposure.
By approving this proposal, the DAO will finalize the recovery and compensation process in a transparent and accountable manner, consistent with the prior governance decision.
GLV Distribution Summary
The table below summarizes the data from the initial GLV distribution to GLP holders:
| Metric | BTC GLV | ETH GLV |
|---|---|---|
| Total GLV Distributed | 8,074,796 | 8,776,834 |
| Total Value Distributed (USD) | $12,979,542 | $13,546,803 |
| Total GLV Claimed | 6,347,262 | 6,899,002 |
| Total Value Claimed (USD) | $10,202,680 | $10,648,421 |
| Total Users Eligible to Claim | 42,037 | 42,040 |
Note: These figures include some data from GLP integration partners that participated in the distribution process. More details and live metrics are available on the Dune Analytics Dashboard.
Conclusion
This proposal requests DAO approval to allocate $500,000 from the treasury to fund the GLV incentive distribution. The funds will be transferred to the Security Committee multi-sig, which will oversee the distribution process in coordination with contributors.
Following the transfer, GLV [WETH-USDC] and GLV [BTC-USDC] will be distributed to all eligible addresses, based on the Snapshot taken on November 13th at 8 PM UTC. This distribution of incentives marks the final step in fairly resolving the Arbitrum GLP recovery effort, in line with the DAO’s approved plan.