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

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

#471

Post by cylon13 »

solomonb wrote: post #256
rawtxapp wrote: post #242

Earlier quoted context omitted.

The flip side of that is any smart contract that stood the test of time should be rock solid. For example, there are huge incentives to go ahead and hack a big contract like maker, compound, uniswap or aave, so you can bet that there's highly qualified people out there trying to hack them as we speak, yet after all this time, they are still working as intended. I have a lot more trust in that kind of product than in…

This sounds like a fallacy of the inverse. Those contracts not being hacked yet is no proof that they are resistant to hacks.

It is pretty good evidence that they are resistant to hacks though, and speaking about interesting evidence that doesn't pass the bar of proof isn't some kind of logical fallacy. That's a pretty high bar to set for what you're willing to integrate information-wise about the world into your model of it.

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

#472

Post by ineedasername »

salt-thrower wrote: post #354
__s wrote: post #346

Earlier quoted context omitted.

VCs blowing an order of magnitude more on coke doesn't make the news

A VC publicly saying "I don't spend money on coke" as a marketing tactic and then getting busted doing just that would make the news. Much like a coin that claims "this coin is stable and its value is tied to USD" getting looted and crashing to $0 also makes the news.

Well, it wouldn't make the news if the price dropped because the actual USD value dropped to zero. That would be perfectly legitimate. Of course the world would be burning as 5lb bags of rice became worth a dozen human lives, so tech news in general might not be very top of mind at that point.

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

#473

Post by xur17 »

acjohnson55 wrote: post #464
ekir wrote: post #365

Earlier quoted context omitted.

It's fairly common to deploy a proxy contract, which allows for a sort of updating. Basically you deploy a new contract and have the proxy point to that new contract instead of the old one. There are definitely some limitations and it's not fully standardized yet. There's a tentative standard here https://github.com/ethereum/EIPs/issues/1538 and OpenZeppelin also has their own implementation. Although neither of thes…

The problem there is that it allows people with deploy privileges to unilaterally change the rules. So you lose "code is law". Hypothetically, you want to custody of assets in an immutable contract with the minimal amount of privileges, and use proxy contracts for higher level on-chain functionality. But it's not so clear to me that it's possible to achieve a perfect factoring, in general.

Typically folks require a governance vote (so multiple parties) + a timelocked contract, and then after some system age / volume they burn the option.

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

#475

Post by shkkmo »

xur17 wrote: post #456
Aperocky wrote: post #426

Earlier quoted context omitted.

It's a rapidly inflating bubble like NFTs and subprime mortgages.

What aspect of stablecoins makes them a bubble?

A rapidly rising market cap that depends on the expectation of continued growth of demand. Some stablecoins are more protected than others against drops in demand.

However, without a compete backing the the currency a stablecoin, there is a point at which sufficient supply of the stablecoin cannot destroyed and the peg will break as supply outstrips demand.

When the bubble pops there will be a lot of broken pegs but it most likey won't wipe out every stablecoin.

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

#476

Post by imtringued »

teawrecks wrote: post #288
LudwigNagasena wrote: post #167

Earlier quoted context omitted.

The audience is the people who don’t want to deal with the government for whatever reasons, the most obvious one is doing something illegal like buying drugs or costly like sending money overseas in developing countries.

First world citizens like to complain about how little they trust their govts, but I find it very telling when those same citizens can only see crypto as a benefit to nefarious actors. It's like complaining about Facebook and continuing to use Instagram.

I think it is because we are allowed to complain in the first place. Free speech is free (monetarily and legally).

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

#477

Post by xur17 »

jMyles wrote: post #461
PragmaticPulp wrote: post #321

Earlier quoted context omitted.

The stablecoins that succeed aren't very interesting because they're simply blockchain representations of actual funds held elsewhere. Or at least funds that are claimed to be held somewhere. Those stablecoins are simply a redeemable, tradeable representation of money held somewhere else. These artificial stablecoins that attempt to get clever with algorithmic finance and smart contracts are interesting because they…

> The stablecoins that succeed aren't very interesting because they're simply blockchain representations of actual funds held elsewhere. Now do MakerDAO.

Or LUSD (which is >100% backed by ETH).

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

#478

Post by gumby »

ekir wrote: post #365
unholiness wrote: post #339

Earlier quoted context omitted.

But it's so much worse than that, right? Bugs in a smart contract are immutable. Those are just the terms everyone agreed to. There's simply no path to deploying a fix that every good actor agrees is beneficial.

It's fairly common to deploy a proxy contract, which allows for a sort of updating. Basically you deploy a new contract and have the proxy point to that new contract instead of the old one. There are definitely some limitations and it's not fully standardized yet. There's a tentative standard here https://github.com/ethereum/EIPs/issues/1538 and OpenZeppelin also has their own implementation. Although neither of thes…

Doesn't a proxy contract defeat the whole purpose of algorithmically enforced contracts?

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

#479

Post by rawtxapp »

Retric wrote: post #465
rawtxapp wrote: post #431

Earlier quoted context omitted.

Even being able to grind a smart contract to a halt would be very profitable if you shorted it right beforehand.

Even then you are limited things to people who are willing to break the law and have a giant sign pointing them as a likely culprit.

I mean people short crypto all the time, averaged over a long enough period of time long/short ratios are roughly ~50/50 [1]. It's normal market behavior. And if you're shorting one of the big ones, you can most likely do it on defi without even providing a name.

1: https://www.bybt.com/LongShortRatio

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

#480

Post by ineedasername »

fleddr wrote: post #349
NationalPark wrote: post #311

Earlier quoted context omitted.

I think it's pretty obvious that people here are very literate about the cryptocurrency space and just find it amusing, apparently to the chagrin of true believers.

Quite the opposite. It's valid, healthy and even recommended to have significant skepticism regarding crypto. I think that's fair game, as about 90% (or more) of coins are pump-and-dump schemes. Further, almost everything "Defi" is supremely risky, as they are completely unregulated, not insured, often lack liquidity, and can go down the drain at moment's notice. Fine. However, there's a general anti-crypto stance he…

I don't think there's a strong anti-crypto stance here. It strikes me much more as a strong anti crypto-fanboy stance. I'm not saying there's no one on HN who doesn't like crypto. I just think that, as a technogy, the general sentiment is "it's not fully baked yet". When that runs head long into dogmatic refusal to admit to any problems with crypto as a concept or a particular currency, the sparks that fly may look anti-crypto.
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