Crypto CEO threatens customers after mistakenly sending them millions

Post by tluyben2 » Sun, Oct 03, 2021, 5:28 AM UTC

woodruffw wrote: post #21

> Otherwise, it's being reported as income to the IRS, and most of you are doxxed. This is an extremely confusing threat, given that sending the coins back would be the taxable event from the IRS's perspective.

Post by Mengkudulangsat » Sun, Oct 03, 2021, 5:30 AM UTC

forty wrote: post #47

danielvf wrote: post #27

This bug happened to the crypto project Compound. I work for a crypto company that has a DeFi product that uses Compound. So I've been deep into following this since it started. The funds sent to users were "rewards" for using the platform. Compound didn't actually lose any user funds, it was Compound's "governance token" that was given out. Although user funds were not affected, billions of dollars have been pulled…

The fact that you can give away millions by mistake and do nothing about it then break the systems then do not much about it says a lot about crypto currency practicality ;) I wonder when this madness is going to stop.

Post by newswasboring » Sun, Oct 03, 2021, 5:32 AM UTC

toomuchtodo wrote: post #29

systemsignal wrote: post #28

Earlier quoted context omitted.

How is it fraud if the smart contract allowed it? Actually curious what makes it fraud. Just because one group wants the money back?

Lawful intention. What the smart contract dictates isn’t necessarily the final authority, but what the intent was (per legal interpretation of state contract law).

Post by sumedh » Sun, Oct 03, 2021, 5:32 AM UTC

spenczar5 wrote: post #37

toomuchtodo wrote: post #33

Earlier quoted context omitted.

The sender did not mean to send it, making it misappropriation or unjust enrichment. Edit: (Re Revlon) https://www.npr.org/2021/07/23/1019909860/banque-worms (NPR piece on the Revlon incident) > Elisabeth de Fontenay is a professor at Duke University's law school, and she used to be a corporate lawyer. > DE FONTENAY: When payments are made, for example, from banks to individuals like all of us in error, we have to gi…

Look at the Citibank Revlon case from last year [0]. In a clerical error, Citi sent $900m to a bunch of hedge funds, related to some Revlon debt. It asked for it back. It got about $400m. It sued for the other $500m… and lost in court. I’m not saying this is identical to that case, which depended upon New York law. But it is far from clear-cut and I think you are being way too confident in your view, since nothing li…

Post by tluyben2 » Sun, Oct 03, 2021, 5:36 AM UTC

arcticbull wrote: post #53

tluyben2 wrote: post #52

Earlier quoted context omitted.

> would be the taxable event from the IRS's perspective. But you can explain that right? Cannot imagine you would be taxed on that: you would get taxed on 10% you keep though when you sell up. Or do you pay over that right away in the US?

Each transaction is its own taxable event, with taxes due based on the difference between the cost basis and the disposition price.