SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon • Hacker News Board

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#181

Post by fastball » Mon, Jun 28, 2021, 6:57 PM UTC

res0nat0r wrote: post #146

derefr wrote: post #80

Earlier quoted context omitted.

> that the world does not run algorithmically Sure it does: moving gold and commodities between countries in non-mutually-friendly regimes, very much resembles crypto. Fiat finance is a system of contract law built on top of a de-facto "state of nature" of irreversible no-arbitrator commodity transfers. It exists in places where people can agree on who the arbitrating party should be. It does not exist outside of tho…

At least to me, and possibly others, any system which I have my money invested and I can lose everything I own with no recourse due to some exploit is completely laughable and something I will never ever touch. There's a reason folks keep their life savings in a Chase bank account, because if something like this happens you have recourse to recover your money.

People have never lost their life savings when held in a bank account?

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#182

Post by conradev » Mon, Jun 28, 2021, 6:58 PM UTC

derefr wrote: post #154

jtbayly wrote: post #116

Earlier quoted context omitted.

So... sending money to where your own government forbids you to send it? It sounds like you're admitting that the point of cryptocurrency is simply to break the law, while pretending like the purpose is much bigger.

There is more than one "law." Each fiat ecosystem is its own system of financial law, each mutually-incompatible with any other fiat ecosystem. Cryptocurrency gives an alternative arbitrator that allows for these mutually-incompatible systems of law to be bridged. Also, to be clear, in the example I mentioned, the government of the US does not forbid trading with Nigeria/Liberia/etc. Traditional money-transfer servic…

Does Wise (fka TransferWise) send money to those countries?

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#183

Post by graeme » Mon, Jun 28, 2021, 6:58 PM UTC

Jhsto wrote: post #168

chrisco255 wrote: post #114

I honestly don't understand why this coin even makes the news. At $250K it was less than a microcap penny token. It's insignificant and not worth a print.

Despite the low liquidity on the exchange, the market cap of the token was supposedly $250M: https://twitter.com/Mudit__Gupta/status/1409463917290557440?...

How did they have a marketcap of $250M as a stablecoin when they had 1000x less in reserves?

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#184

Post by slg » Mon, Jun 28, 2021, 6:59 PM UTC

brianwawok wrote: post #132

Barrin92 wrote: post #92

Earlier quoted context omitted.

I'm gonna be honest I don't know what the audience is for a product where you risk losing your entire life savings because you typed a wrong word in a smart contract rather than paying a middleman a fraction of a percent. It's almost like a sort of willful ignorance of division of labour and the concept of pooling risk.

Doing illegal things, mostly. If you are working a w2 job and paying taxes and paying your mortgage / auto loan... crypto doesn't really help you. Blackmail? Awesome. Buying illegal substances? Awesome. Gambling? You got it...

To be fair illegal is not the same as immoral. For example, cryptocurrencies can also be used to transfer money out of financial system controlled by oppressive regime which is largely a positive use. The problem is that "oppressive regime" is a matter of opinion and therefore these transfers are indistinguishable from tax evasion and other financial crimes. Techno-libertarians see that as a feature, I think most of the rest of us see that as a bug. There is no economic or technical solution there. It is almost exclusively an issue of personal politics.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#185

Post by dcolkitt » Mon, Jun 28, 2021, 6:59 PM UTC

tptacek wrote: post #130

dcolkitt wrote: post #113

Earlier quoted context omitted.

Much of the world literally does run algorithmically. Literally every day you trust your life, privacy and money to algorithms that make decisions without human intervention. The financial system trades trillions of dollars in automated systems that make split-second decisions in a way that precludes human supervision. Hedge funds and banks already trust algorithms that if broken could lose billions. The existence of…

It literally does not. The world runs advised by algorithms, but not governed by them. It's a fundamental difference. When algorithms in the real world create lose-lose outcomes, people override them, which is why when your credit card gets stolen you don't end up paying for stuff. You can bake that logic into a software contract, but if the design of your system is that the totality of software contracts are the fin…

You are aware that the vast majority of financial market trading is run by algorithms that govern not advise vast amounts of capital in an irreversible way.

Sometime these algorithms break or are exploited. Often in spectacular disasters. Knight lost half a billion dollars in 30 seconds. Nobody reversed though, even though it was clear error.

If you have a 401k I guarantee you that a significant amount of your money was traded by an algorithm that if broken would have lost everything. If the question is whether people would ever trust capital to irreversible algorithms, the answer is they already do. It’s called the stock market.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#186

Post by NovemberWhiskey » Mon, Jun 28, 2021, 6:59 PM UTC

dcolkitt wrote: post #113

omk wrote: post #31

A point that most crypto heads miss is that the world does not run algorithmically. Legal contracts do not work like a software program and that characteristic is a feature not a bug. Not being able to reverse transactions that were part of an exploit is in infact a bug. Businesses need that tolerance for error. You need an oracle in your system. The oracle can maintain transparency of the attestations carried out if…

Much of the world literally does run algorithmically. Literally every day you trust your life, privacy and money to algorithms that make decisions without human intervention. The financial system trades trillions of dollars in automated systems that make split-second decisions in a way that precludes human supervision. Hedge funds and banks already trust algorithms that if broken could lose billions. The existence of…

>Literally every day you trust your life, privacy and money to algorithms that make decisions without human intervention. The financial system trades trillions of dollars in automated systems that make split-second decisions in a way that precludes human supervision.

... but when that stuff goes wrong, which it does, we don't just say "geez that's too bad, the code is the code".

Look at the 2010 flash crash: something like 20,000 trades were broken after discussion between FINRA and the exchanges based on how far they were from the reference price.

Similarly, I don't end up eating the entire loss if my bank's anti-fraud system mistakenly approves a transaction on a stolen credit card, because I have 60 days from the statement date to report the problem under the FCBA.

The point is that in most cases where physics is not involved (e.g. flight control systems), the real-time behavior of the systems is backstopped by processes to deal with exceptions in a slower, more considered way.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#187

Post by pavel_lishin » Mon, Jun 28, 2021, 7:00 PM UTC

UIGYUIUYG wrote: post #175

brianwawok wrote: post #132

Earlier quoted context omitted.

Doing illegal things, mostly. If you are working a w2 job and paying taxes and paying your mortgage / auto loan... crypto doesn't really help you. Blackmail? Awesome. Buying illegal substances? Awesome. Gambling? You got it...

You can literally say that about cold hard cash. Blackmail? Pay cash. Buying illegal substances? Cash. Gambling? Get your cash out. It's all in how you use it. https://eandt.theiet.org/content/articles/2021/05/moon-missi... Anything is a store of value, wood, gold, water, dogecoin ect. If people want to accept something for something else this is a way of life. It's just sad that people only see the bad use cases. Ho…

Do people who had SafeDollar have control over their own money? Did the people whose money got locked in the DAO because of a software bug have control over their own money?

> How about if I transact only in crypto (Monolith card), now every purchase I make is via crypto

Do you in fact do this?

> nothing different to using a bank card with US dollars backing it

There certainly is if you read Monolith's fine print, and it's wildly disingenuous to pretend otherwise:

The Monolith account and Visa Debit Card are electronic money products which are not covered by the Financial Services Compensation Scheme or the Deposit Insurance System of the Republic of Lithuania. The funds will be safeguarded by Contis Financial Services Ltd or UAB „Finansinės paslaugos „Contis“. For any disputes, the Financial Ombudsman Service and the Bank of Lithuania consumers disputes resolutions institution are available.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#188

Post by gowld » Mon, Jun 28, 2021, 7:00 PM UTC

CydeWeys wrote: post #135

jvanderbot wrote: post #99

Earlier quoted context omitted.

This argument does not help. Those same folks cannot carry around a crypto-buck either. There are plenty of mobile-only banking solutions that are widely used in non-western worlds, and that's likely a model for emerging economies. When electronic banking comes, OP is saying that standard banking ("perfected over millenia TM") is honestly quite preferable over algorithmic contracts.

> This argument does not help. Those same folks cannot carry around a crypto-buck either I'm not a big DeFi booster, but I don't think that's true. All it takes is a mobile phone. There's some pretty compelling videos coming out of El Salvador showing just how easy it is to instantly transact Bitcoin between two people simply by scanning a QR code on the other person's phone and then sending a Lightning Network trans…

How is that different from M-Pesa or Venmo? The difference is that no one has shown up yet in that particular location to set those up, but someone did come set up Bitcoin infra in El Salvador.

Still, the ease of spending crypto in El Salvador, great as it is, does not prove it's safe and that everyone won't get hacked and robbed.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#189

Post by phreack » Mon, Jun 28, 2021, 7:00 PM UTC

toomuchtodo wrote: post #91

drcross wrote: post #82

Earlier quoted context omitted.

The majority of people in the world can't get a credit card.

This is true, but with that said 54 countries have instant payments [1] [2]. This number will only grow, as you’re just pushing messages around queues. Once Congress lit a fire under the Fed, it’s only taking ~4-5 years to roll out instant payments in the US. This is very fast for such endeavors. Your average financial consumer in most countries is going to trust their bank and government to protect their fiat vs cry…

The crypto movement in South America is growing explicitly because people are increasingly not trusting their banks and government to protect their fiat. I've never heard of Zelle and not everyone has access to a clandestine US account, while anyone can buy open a crypto wallet and get some DAI.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#190

Post by rednerrus » Mon, Jun 28, 2021, 7:00 PM UTC

UIGYUIUYG wrote: post #175

brianwawok wrote: post #132

Earlier quoted context omitted.

Doing illegal things, mostly. If you are working a w2 job and paying taxes and paying your mortgage / auto loan... crypto doesn't really help you. Blackmail? Awesome. Buying illegal substances? Awesome. Gambling? You got it...

You can literally say that about cold hard cash. Blackmail? Pay cash. Buying illegal substances? Cash. Gambling? Get your cash out. It's all in how you use it. https://eandt.theiet.org/content/articles/2021/05/moon-missi... Anything is a store of value, wood, gold, water, dogecoin ect. If people want to accept something for something else this is a way of life. It's just sad that people only see the bad use cases. Ho…

The difference is you can't use dollars to do digital transactions. Good luck with sending a suitcase full of cash to SatoshiDice. Even better luck getting a suitcase back.

The only value add for crypto right now is that it's pseudoanonymous and you can use it for black market transactions. Other than that why not just use Venmo or CashApp?