Recovery Proposal 2 of 3: Onyx to be Acquired by Strike Finance

Governance
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The Onyx Protocol suffered an exploit on its oPEPE market due to a bug in the rounding implementation. Thus, a ~$2.1m protocol loss occurred to the lending markets of the protocol. XCN Staking and Uniswap liquidity pools remain unaffected. The DAO is working with security partners to track down the hacker and then report the hacker to law enforcement.

The proposal

The Onyx DAO has reached an in/principal agreement with Strike Finance DAO for Onyx Protocol to be acquired by Strike pending multiple on-chain governance votes and approvals by the community on both protocols.

To minimize losses to Onyx Protocol users, Strike will be acquiring Onyx with a roadmap of the acquisition articulated below:

  1. Onyx Protocol will vote to cease and stop its markets, including staking features. All users can safely withdraw their staked XCN and claim any accumulated reward. The remaining un-circulating XCN will be burned;

  2. There will be a community treasury set up for compensation of those affected users to receive XCN in dollar value back funded by Strike through existing supply and not through the on-chain proposal to release an additional ~3b XCN;

  3. XCN will be burned and swapped for STRK at a ratio of 20,000 per 1 STRK token. The Onyx DAO will work with exchanges to help facilitate a seamless transition;

  4. Strike will add support for NFT Markets, which include CryptoPunks and BAYC for NFT liquidity.

The Strike’s addition of the NFT vaults will make the decentralized protocol almost identical to Onyx Protocol’s product offering. Strike offers STRK staking, voting, DAO, lending, and liquidity vaults, as well as further expanding on product availability.

Once there is/If there is a successful on-chain proposal, the Strike team will initiate their own on-chain proposal to begin allocating STRK available for the swap.

To learn more about Strike Finance, visit strike.org.

Subsequently, the Onyx DAO cannot control which exchanges can support the swap. Those exchanges who cannot/will not support the swap, are recommended to withdraw their XCN to their own wallet, where there will be a portal bridge to enable swaps from XCN to STRK.

Voting

The on-chain votes will occur on approximately November 6th to ensure sufficient time for users who want to participate to stake their XCN to vote on this. There are currently two propositions:

The community will vote.

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The value of getting acquired seems terrible, because XCN alone has more value after the LDA Capital facility is used. Which creates confidence for the users and bringing value to XCN itself. If it does get acquired, not as much of the value will be retained compared to it alone.

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What an abominable takeover scheme. I don’t think Chain (XCN used to be in the top 50 coinmarketcap) is now struggling like this.

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XCN Supply community members seem to be unaffected by this hack. Are you going to enable those users to withdraw their xcn in order to participate on these proposals?

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strike finance has some connection with onyx ? because strike has also same ui as onyx has

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I believe that the best solution would be for XCN to employ the LDA Captial facility to make users whole rather than being acquired by strike.

  1. The Advantages of Using the LDA Capital Facility:
    Tldr: They are a fund that does not wish to sell their investments at a loss (XCN price rise) and are a huge confidence booster. There would be a future for XCN

Despite the fact that XCN is sold to LDA Capital, they are a fund and their purpose is to make money. At the current pricing, they would lose money if they sold their entire interest, thus they have an incentive to ensure the profitability and growth of XCN. In turn ensuring that they would be able to earn a greater profit but also improving onyx for all users at the same time.

Also, because it is an Over-The-Counter (OTC) transaction, selling to LDA Capital would result in no instant price drops or crashes, but rather a simple transfer of funds between the DAO and LDA.

Furthermore, rising Onyx from the ashes with the LDA Capital Facility would be a big confidence booster. Because of this feature, users have a larger belief in the fact that Onyx Protocol has good backing and can use their backing, implying that the upside of Onyx is far superior than that of many other protocols. Wormhole Bridge, for example, was exploited for an outrageous 327 million, after which their partner Jump Capital stepped in and covered the difference. This created massive confidence for wormhole which is now still in operation greater than ever.

Furthermore, the quantity of XCN is not newly produced but rather from the DAO, implying that ownership is transferring rather than an additional minting of XCN.

Of course, more clarity regarding LDA’s function would be beneficial for members, but because the nature of a fund is profitability, we can be certain of the goal of strengthening XCN.

With both the future usage of XCN and the confidence increase, Onyx Protocol has a promising future.

  1. Getting Acquired by Strike is pointless.

Let Onyx Protocol (XCN) NOT be acquired by strike.

If the LDA Capital Facility is available, the strike acquisition makes no sense. This is because the increased confidence in XCN makes it desirable for Onyx to be its own separate entity, allowing it and its users to benefit from the bullrun. If it is acquired, the increased confidence will not be transferable to strike and would thus be wasted.

Furthermore, with Onyx not being acquired, members of Onyx have a lot more upside.

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Hi,

Thank you for your opinions.

If you are aware of risks and want to Borrow/Supply, including XCN, use https://testapp.onyx.org. It may be helpful to withdraw XCN and then stake to get voting power.

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That Strike deal is an absolute insult. I’d rather see my XCN go to 0 than agree to that.

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If everyone rejects your proposal, there will be no need to vote.

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Its sad to be honest . its like selling yourself .

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Hi @alex Can you please explain more about strike finance . as i can see onyx had collab with strike in past too .

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Why is this even a proposal? Nobody asked for this. What stops strike from buying a lot of coins and passing this themself? Highly unlikely but possible if they wanted too/could do it.

If you don’t want to be the manager anymore Alex, resign. This proposal looks like a flat out exit strategy.

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Is strike also a form of compound ?

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Sounds like Alex is not compatable to be head of DAO. paid himself bonuses, doesnt want to show his face. got hacked, TVL is down 50%, price is down 90%. Its time to kick him out of Onyx

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when voting gonna start ? any info on that

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I think yes as the UI matched a lot

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Great insight and transparency

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:sneezing_face: :saluting_face:

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The LDA Capital facility would be preferable than a merger with Strike for XCN holders. If XCN and Strike merge, their shares will be diluted, and XCN will be delisted from the various prominent exchanges where it is now listed. XCN is listed on Coinbase and numerous other major exchanges, which is a big accomplishment that offers it with enormous marketing options. Because Blackrock’s ETF custodian is Coinbase, if the ETF is approved, a lot of traffic will go to Coinbase, possibly overflowing into XCN. Because of the loss of market exposure by being removed from these big exchanges it would not be beneficial to XCN holders. As a result, employing the LDA Capital Facility would be more ideal.

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I cannot speak about these things on your level lol , but my first thought reference the third option was why would I or anyone want to stake at 10%. I agree with everything you’ve stated. Hope we have the votes for it.