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Did I just lose half a million dollars?

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Re: Did I just lose half a million dollars?

#411

Post by radford-neal »

erikbye wrote: post #337
iqanq wrote: post #164

Earlier quoted context omitted.

One could write a sentence like that about smart contracts. One I pulled from Google: Smart contracts are simply programs stored on a blockchain that run when predetermined conditions are met. They typically are used to automate the execution of an agreement so that all participants can be immediately certain of the outcome, without any intermediary’s involvement or time loss. They can also automate a workflow, trigg…

And here's the "oh so complex" contract in question, all 60 lines. contract WETH9 { string public name = "Wrapped Ether"; string public symbol = "WETH"; uint8 public decimals = 18; event Approval(address indexed src, address indexed guy, uint wad); event Transfer(address indexed src, address indexed dst, uint wad); event Deposit(address indexed dst, uint wad); event Withdrawal(address indexed src, uint wad); mapping…

Why does anyone want to use this?

Knowing nothing about it, this is the question that remains unanswered to me after reading through dozens of comments on this debacle. What was the person who lost half a million trying to accomplish? For what benefit?

I assume that if you just want to use ETH to buy and sell stuff, you don't have to get involved with any of these smart contracts.

Re: Did I just lose half a million dollars?

#412

Post by pjkundert »

nickjj wrote: post #381

Here's an unrelated but related question: How do you store your wallet / private keys where you would be comfortable storing an amount of money that's important to you? It feels like a bunch of consumer grade options we have are kind of flaky: Flash drives are extremely undependable. I've had a few fail to read after sitting in a closet for a year. SSDs can supposedly have data loss pretty quickly if left unpowered (…

Use SLIP-39, and a hardware wallet that allows recovery from SLIP-39 shards (eg. a Trezor).

With BIP-39, you are simply going to lose your wallet, eventually. It's almost inevitable. Either because you lose the 12- or 24-word passphrase, OR because someone else finds one of your backups.

I've written a decent Python implementation, here, which is simple enough to review:

https://github.com/pjkundert/python-slip39/

Re: Did I just lose half a million dollars?

#413

Post by hotpotamus »

jquery wrote: post #263
nly wrote: post #64

Earlier quoted context omitted.

Even in todays traditional banking system there are a litany of cases where people refuse to take responsibility for their gullible actions and expect their bank to bail them out. There are a few stories on the ThisIsMoney (UK's Daily Mail's money rag) front page right now about relatively convincing and sophisticated scams where people were robbed of thousands. The average person isn't ready for the risk of crypto.…

It’s really incredible how easy some of these scams appear to pull off. “I’m your oldest child and no my microphone doesn’t work so I can’t talk to you and I need $2000 immediately” and the parent bypasses warnings from the bank about possible fraud and shoves the transaction through… It also shows how many of these scams can be defeated with a few simple precautions. Most of them would be defeated by calling the ban…

This is one of my actual fears for deep fakes - imagine actually being able to perfectly imitate someone's child to scam them. My parents and I long ago set up a codeword system as a way to delegate trust, but imagine actually hearing your child in distress - it could short circuit your skepticism pretty quickly.

Re: Did I just lose half a million dollars?

#414

Post by ClumsyPilot »

capableweb wrote: post #331
zkldi wrote: post #316

Earlier quoted context omitted.

So your definition for "valid action" is just that the eth network lets them do it? They clearly didn't want to burn £500k, and that is now irrecoverable, alongside 260 other people who made the same mistake, on a smart contract that forgoes validation for gas fees. How is this not invalid?

> So your definition for "valid action" is just that the eth network lets them do it? Yes, this is indeed the definition for "valid", that the protocol allows them to do it. It was a valid action, but not the action the user actually wanted to perform. There are two ways of avoiding these scenarios: A) use UIs and don't interact with the protocol without safeguards, as the UI will prevent you from making mistakes (th…

"It was a valid action, but not the action the user actually wanted to perform."

It's an action noone ever has ever wanted or ever will want to perform.

In the same way putting your finger inside a power socket is an invalid action, and people who designed sockets were smart enough to make it impossible.

Re: Did I just lose half a million dollars?

#415

Post by BatteryMountain »

capableweb wrote: post #249
BatteryMountain wrote: post #246

Earlier quoted context omitted.

Really? If a mail server (and the post office of most countries) don't have the specified address, it either gets sent back if there is a return address written (email non-delivery notice (aka return to sender, NOT undo) or it goes into a catch all bin (same as a lost & found)(or root account for most mail servers)(or dump it in the bin).

Yes yes, as mentioned in another sibling comment, your wallet won't allow you to send anything to an invalid address. In this case, the address was not invalid, so why expect it to get rejected?

So imagine the bank give all objects in their company an address. The desk has an address, the fridge has an address and so on. Bank accounts have an address too. All these addresses look the same and use the same system to interact with them. The problem is that Johnny wanted to deposit $50 dollar into his account, but he accidentally used the wrong address, and now the fridge in the the bank's kitchen on the 5th floor now owns $50. To his dismay, there is nobody to send his funds back since no human owns the fridge and nobody is even able to break the fridge open to get it out. Don't blame the fridge they say, don't blame the bank they say, don't blame the currency or the address system or the person who made the rules so that fridge addresses and bank account addresses work the same. No, lets blame Johnny, the dumb ignorant fool who doesn't understand the glory of the banks special addressing system. It is working as intended. He should've known better, he should've read the docs etc. Fuck Johnny and his $50.

Re: Did I just lose half a million dollars?

#416

Post by analog31 »

djhworld wrote: post #95
westcoast330 wrote: post #38

The future of currency ladies and gentlemen. This money is literally gone. Unrecoverable. Like he took the money out to a barrel and burned it. Only he didn't get any warmth out of it in exchange.

> Unrecoverable. I'm not very well versed in this stuff, but surely the tokens he sent are somewhere right. Like if you sent $500k to a bank but put the wrong account number in, the $500k would still go _somewhere_. It might be difficult to recover, but it's not like the money just disappears.

Actually in the case of the bank, no. Conventional money is numbers just like crypto. I think the difference is in the case of conventional money, someone is empowered to manually override the transaction and make you whole.

As I've said in the past, money is a technology, and this kind of override mechanism is built into the design of conventional money, but not into the design of crypto.

Re: Did I just lose half a million dollars?

#417

Post by rich_sasha »

faeyanpiraat wrote: post #221
rich_sasha wrote: post #213

Earlier quoted context omitted.

But it is. If you buy the wrong asset, you can sell it back and get most of your money back. There is a low friction “undo” button. No such thing in crypto.

Options work differently, you can lose all your money.

If by accident I buy an option / wrong option, realise that, I can probably sell it and get my money back, less commission, spread and change in value.

Re: Did I just lose half a million dollars?

#418

Post by rich_sasha »

in3d wrote: post #217
rich_sasha wrote: post #213

Earlier quoted context omitted.

But it is. If you buy the wrong asset, you can sell it back and get most of your money back. There is a low friction “undo” button. No such thing in crypto.

Buy a penny stock or an illiquid option and you certainly won't get most of your money back. In addition, there are many other hidden risks. For example, you could have the broker increase the margin rates overnight leading to forced liquidations or the stock could be halted and impossible to trade for months. You can even end up owing more than your whole account is worth if margin is enabled.

Right, if I’m unlucky then sure, something like this can happen.

But I’d have to be really unlucky and/or careless to really lose 20%+ of my money.

Whereas with crypto it’s so easy to lose 100% plus gas fees, all the time.

Re: Did I just lose half a million dollars?

#419

Post by rosndo »

distances wrote: post #193
alanfranz wrote: post #33

Earlier quoted context omitted.

> mistyped Very unlikely, the checksum would prevent that. And most banks (even though I’m unsure it is mandatory) will check the recipient, if totally mismatched a warning will be raised. But if you send money to the wrong iban+recipient, the money is gone.

It is not gone. You may have to go through courts if the recipient does not return the money voluntarily though.

You will not have any luck enforcing that court judgment if the recipient does not want to play ball. All they need to do is transfer the money to another country.

It is very unlikely that law enforcement would help you in a situation like this, especially internationally.

Re: Did I just lose half a million dollars?

#420

Post by Rastonbury »

kuhewa wrote: post #306
capableweb wrote: post #293

Earlier quoted context omitted.

If you're gonna deal directly with the forex industry without any safe-guards there will definitely be a bunch of jargon around, have you ever dealt with the insides of forex trading before? In general, giving someone money does not require intimate knowledge of what's happening behind the scenes, that's true. But the submission is not about a normal transfer, the user is explicitly avoiding the safe-guards in place,…

> have you ever dealt with the insides of forex trading before? Why, is there a way to send currency directly and irrecoverably into a paper shredder on the inside?

The idea behind 'smart' contracts is to have immutable and decentralized pieces of code on the blockchain to execute transactions, eg. to swap ETH for NFTs or ETH to WETH like in the OP. They have addresses because they can keep a balance, but because they are supposed to be dencentralized no one can move that balance. If it did have a transfer or withdraw function people would have to trust the creator not to suddenly scam everyone.

But yeah the ability to send the directly to the address is stupid. There are no real world and crypto world use cases do it. I think the most glaring thing is that person has 500k in ETH but no idea how smart contract work or how to use the functions...

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