October 23, 2025

I. Executive Summary: Cash Relief, Recovery Claims, and Enhanced Security

On October 15, 2025, Typus Finance experienced a security incident involving a critical oracle vulnerability, resulting in a $3.26 million USD loss from the TLP contract. We take full and complete responsibility for this failure in our security process.

The assets drained were:

• 588,357.86 SUI
• 1,604,034.70 USDC
• 0.60 xBTC
• 32.23 suiETH

Our team acted immediately upon detection to pause all protocol contracts, limiting further damage. A detailed post-mortem report is available here.

Today, we present our definitive recovery plan. The Core Team’s TLP loss (approx. $513k USD) is excluded from repayment; the team fully accepts this loss.

The Typus Recovery Plan provides $2.93 million USD in compensation to affected users. It balances immediate cash relief with a commitment to repay the remaining losses over time via “Recovery Claims” funded by future protocol revenue. This approach ensures the protocol’s sustainability while working towards making all users whole. Fundamental security upgrades are also central to this plan.

Critically, this plan makes all users with losses under $10,000 100% whole in cash immediately. Larger LPs (losses ≥ $10,000) will receive an initial cash payment, with the remainder converted to a Recovery Claim, plus a goodwill allocation of $TYPUS tokens.

II. The Compensation Plan: A Tiered Approach

We are committed to compensating 100% of the $2.93 million USD in user losses via the following tiered model. This plan is definitive. We will also fully compensate those who minted TLP during the incident for their deposited liquidity alongside the initial cash compensation.

Losses Under $10,000 USD:

• Compensation: 100% via immediate cash distribution.
• Action Required: None (Automatic distribution).

Losses Between $10,000 and $100,000 USD:

• Compensation: 50% via immediate cash distribution. Remaining 50% becomes a “Recovery Claim,” repayable in cash installments from future protocol revenue.
• Action Required: Must fill out the Google Form and contact the team to coordinate payments. A goodwill $TYPUS allocation will also be provided.

Losses Above $100,000 USD:

• Compensation: 30% via immediate cash distribution. Remaining 70% becomes a “Recovery Claim,” repayable in cash installments from future protocol revenue.
• Action Required: Must fill out the Google Form and contact the team to coordinate payments. A goodwill $TYPUS allocation will also be provided.

Rationale for the Tiered Model: This was a necessary strategic decision to ensure the protocol’s survival, which is the only viable path to fulfilling the 100% repayment commitment for all users. A purely pro-rata cash distribution would deplete our treasury, making a relaunch impossible. Prioritizing smaller holders secures the community consensus needed for continuation, enabling the repayment mechanism for larger claims.

Initial Cash Repayment Assets: The initial distribution (approx. $1.12 million USD) will use the following assets at the specified valuations:

• 191,563.46 SUI (@ $2.788) (Includes liquidity deposited by those who minted TLP during the incident)
• 521,696.12 USDC (@ $1.00)
• 0.20 xBTC (@ $111,385)
• 10.48 suiETH (@ $4,074)

III. A New Foundation: Commitment to Security

Regaining community trust requires a fundamental, multi-layered security overhaul. We commit to the following points:

1. Open-Source Code & Dual Audits: All new protocol code will be fully open-sourced. All new smart contracts must pass at least two separate, external audits from reputable security firms before deployment.
2. Oracle Resilience: We will integrate multiple, independent oracle providers and implement a price deviation circuit breaker mechanism.
3. Public Bug Bounty: We will launch a competitive public bug bounty program following the full relaunch of Typus Perps and sign-off from third-party auditors.
4. Real-Time Monitoring: We will deploy enhanced automated tools for high-frequency, real-time monitoring of suspicious on-chain activity and maintain an emergency pause capability.
5. Fortified Access Controls: All critical protocol actions will require multi-signature confirmation and be subject to a mandatory 48-hour time-lock delay before execution.

IV. Call to Action: Our Shared Future

Typus Finance is not dissolving. The Core Team is fully committed to operating Typus Finance under this new, high-accountability governance structure. Making users whole is our priority, and it is directly dependent on our collective success.

The initial cash payout distribution process will begin tomorrow, October 24th. We will share the final audit results for the new contracts and the specific token distribution mechanism (for eligible larger holders) once finalized, and then commence the full repayment process outlined in this plan. For LPs with losses ≥ $10,000, please ensure you have submitted your contact details via the Google Form so we can coordinate your initial payment and future recovery installments.

We are ready to earn back your trust, one audited smart contract at a time.

The Typus Finance Team