Fourth Open Letter to Alpha Community

Since the Third Open Letter, Alpha Homora, on behalf of users, proposed multiple solutions to Iron Bank directly to return users’ funds, but haven’t been able to come to a complete resolution. While Iron Bank has returned some parts of users’ deposits (on non-Ethereum chains), they still take control of users’ deposits on Ethereum.

The best way forward is for Alpha Homora community to agree upon the plan to negotiate with Iron Bank to return Alpha Homara’s user deposits. This step is being done in public so we can move forward together as a community.

Following is the proposed plan, which should maximize value for Alpha Homora V2 depositors while being fair to Iron Bank's users at the same time.

1. Iron Bank to pause interest accruing immediately
2. Iron Bank to return the total excess ($8,686,364.33)*, which unequivocally belongs to Alpha Homora depositors, back to Alpha in 2 parts:

     a) Iron Bank to return the outstanding excess ($5,326,879.99), as calculated below, back to Alpha by March 14th, 6AM (UTC).

             i) As of current, total liquidity in Iron Bank excluding bad debt = $57,452,881.48 - $30,689,988.09 = $26,762,893.39

             ii) As of current, non-Alpha’s total deposit = $18,076,529.06

             iii) As of current, Alpha’s current borrow = $3,359,484.34

             iv) So, the outstanding excess value = (i) - (ii) - (iii) = $5,326,879.99

     b) Iron Bank to redirect any repayments from Alpha Homora positions from iii) ($3,359,484.34) back to Alpha within 3 days after each repayment is made.

3.   Iron Bank to return Alpha’s collateral (63,000,000 ALPHA) as Iron Bank will no longer have debt with Alpha Homora.

4.   Alpha Homora will work with Alpha depositors on the amount and make depositors whole as much as possible. Once the first three parts are completed, Alpha Homora will propose possible solutions so Alpha community can decide the best option together.  

This solution here is far from ideal. Nevertheless, this middle ground is a good potential solution toward unfreezing Alpha Homora’s user fund as soon as possible.

Alpha Homora would kickstart the discussion around this plan on Discord and start the voting within 48 hours for the community to decide the path forward that Alpha Homora depositors collectively agree to pursue.

Separately, leverage users on Alpha Homora v2 are encouraged to close the positions IMMEDIATELY to make resolving process simpler.

Alpha Homora contributors will be available for any questions or suggestions on Discord.

*The numbers are as of March 9th, 11:08AM (UTC). The actual numbers will need to be adjusted upon execution.