Leading up to the launch of the new chain (Phoenix-1), there was intensive indexing work done to ensure that the right amount of LUNA was distributed to each user of the network.

However, despite our best efforts, an error was made with regard to CW3 multi-sig wallets. We did not blacklist 2 CW3 multi-sig wallets that held large amounts of LUNC and USTC on behalf of the community (The Ozone and Interchain Incentives multi-sigs). This resulted in individual signers of these multi-sigs receiving LUNA airdrops, which they should not have.

Interchain Incentives Multi-Sig Overview

Interchain multi-sig wallet address: terra1jrhxdtwxrsxw3t2al6t3sga89974juhpccuxct

Signers of the Interchain Incentives Multi-Sig

Actions Taken Post-Genesis

To resolve the multi-sig error, the airdropped vested and vesting LUNA needed to be returned to the Community Pool by each multi-sig signer who incorrectly received it:

  1. Send all vested (liquid) LUNA to the Community Pool
    1. Status: Complete
  2. Send all vesting (illiquid) LUNA to the Community Pool
    1. Status: Pending terra1dyn97p558vchcje0zycwfpex7xc67w4zl62nfy and terra1mrutxf7adxg837jl6z85g83pwsn9a2jh3xu9yy
      1. 29 Jul: The **chain upgrade** needed to enable users to send vesting LUNA to the Community Pool was successfully deployed on 29 Jul, 2022. Instructions were then given to each Interchain Incentives Multi-Sig signer to undelegate their vesting LUNA (lead time of 21 days) before TFL shared a front-end that allowed them to send vesting LUNA to the Community Pool.
      2. 13 Dec: The chain upgrade needed to enable Papi’s wallet (terra1mrutxf7adxg837jl6z85g83pwsn9a2jh3xu9yy) to donate its remaining vesting LUNA (due to a bug in the ‘*MsgDonateAllVestingTokens*’ function in handling slashed delegations) was successfully deployed on 20 Dec, 2022. The wallet owner is now in the process of undelegating the remaining 1 staked LUNA (previously used for testing) and will return the remaining vesting LUNA upon its 21-day undelegation time.

Issue

Jimmy refused to complete Action #2 above (Send vesting LUNA to the Community Pool), citing that he first needed to speak to legal counsel. He requested to speak to TFL counsel regarding what he said was about “timing”, but did not elaborate on his supposed concerns. As it turned out, what he wanted to discuss was his own tax liability. Meanwhile, he has actively been withdrawing the staking rewards received from the vesting LUNA (See his wallet and the wallet of the validator he has spun up (The Charity Block)).

Timeline of Events

  1. On 28 May, Jimmy received 1,347,810.646 vesting LUNA as a signer of the Interchain Incentives Multi-sig, which he redelegated to LUNCDAO (a validator he’s personally associated with)
    1. See transactions (1) (2)
  2. Between 29 May and 6 Jun, Jimmy claimed staking rewards from this wallet and sent it to a centralized exchange account. He subsequently returned these LUNA staking rewards to the community on 11 Jun. However, he did wait 6 days before doing so.