Gnosis Chain has activated a contentious hard fork to recover roughly $9.4 million that had been frozen following Balancer’s early‑November exploit that drained well over $100 million across multiple chains.
The hard fork went live on Dec. 22 after months of intense debate in the community about governance intervention versus blockchain immutability. An official announcement said the recovered funds are “now out of the hacker’s control.” Node operators were instructed to upgrade their clients immediately or risk penalties in order to follow the new chain.
Why the fork was needed
Immediately after the exploit, Gnosis validators applied an emergency soft fork that blacklisted the attacker’s addresses. That step stopped further movement of the stolen assets but left them frozen — inaccessible to both the attacker and victims. According to Gnosis infrastructure lead Philippe Schommers, a hard fork was the only technical option that would let the network rewrite its recent history and move the frozen assets into a recovery address controlled by the Gnosis DAO. Schommers also stressed that, while the project aims for an infrastructure where validators cannot censor transactions, the community must discuss how and when to use the power it still holds in exceptional cases.
Community split over precedent
The decision has split the Gnosis community. Supporters describe the hard fork as a rescue mission that helps return stolen funds to affected users. Critics argue that altering chain state undermines the core blockchain principle of immutability and risks normalizing state rewrites. Community members posting under MichaelRealT and TheVoidFreak warned that accepting this intervention without clear, predefined rules could set a dangerous precedent and push the chain closer to centralized, traditional-finance-style governance.
Broader recovery efforts
The Balancer exploit triggered a wide, multi‑party recovery effort across ecosystems. Other projects have already clawed back portions of the stolen assets: liquid staking protocol StakeWise recovered about $19 million in osETH, and Berachain recovered roughly $12.8 million after coordinating with a white‑hat actor. In late November Balancer proposed a reimbursement plan to return about $8 million in recovered assets to impacted liquidity providers, subject to community approval.
What’s next
With the hard fork executed and the specified funds transferred to a DAO-controlled recovery address, attention is likely to shift to formalizing procedures for future incidents — if any — so that comparable cases are handled transparently and consistently. The split in sentiment shows a tension between pragmatic fund recovery and protecting the long-term credibility of immutable ledgers — a debate that will shape governance and incident response across the ecosystem.
Read more AI-generated news on: undefined/news
