The redemption transaction, executed Oct. 9 at 9:59 p.m. ET, burned 776,000 bOSMO and started unbonding about 1.3 million OSMO. Wyles said that withdrew almost all the contract’s OSMO. Rather than make repeated, overpaid withdrawals that depleted other holders’ backing, the plan was to redeem in one transaction and compensate them directly.
Compensation Follows the Snapshot
Eligible balances at block 72,237,940, when the redemption ran, will be compensated at 1.1174 OSMO per bOSMO—the contract’s stated rate immediately beforehand, Wyles said. Selling, transferring or redeeming tokens afterward does not change the snapshot balance used to calculate compensation; purchases after the snapshot are not covered.
The plan includes underlying holders whose bOSMO sat in liquidity pools and other contracts. It excludes payouts worth less than 1 OSMO, along with the community pool’s and Backbone Labs’ own holdings, the disclosure said. Accounts that took advantage of the defect after the redemption are also excluded, according to the disclosure.
Recipients need take no action. Payments are to be sent automatically after unbonding completes. The transaction records a completion time of Oct. 23 at 9:59 p.m. ET, or Oct. 24 UTC; the disclosure says payments will follow shortly afterward.
Liquidity Pools Remain at Risk
Wyles said remaining bOSMO could be redeemed for only roughly 0.06 OSMO each at the time of the disclosure, while new tokens could still be minted for about 0.039 OSMO. Some pools continued to price bOSMO above its redemption value, creating a gap that traders could use to drain their liquidity, he warned.
“If you provide liquidity in a pool that contains bOSMO, we recommend withdrawing it,” Wyles wrote. He also advised against buying bOSMO.
Wyles said a newer contract-code version fixes the defect, but an update was still pending and Backbone had been notified. After compensation payments, the remaining recovered OSMO is to be burned under Proposal 1049.
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