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Synapse still can't find its money

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Re: Synapse still can't find its money

#21

Post by throwup238 »

lesuorac wrote: post #16
gwbas1c wrote: post #7

> In June, the FDIC made it clear that its insurance fund doesn’t cover the failure of nonbanks like Synapse, and that in the event of such a firm’s failure, recovering funds through the courts wasn’t guaranteed. It seems they should be able to sue Evolve (the bank), given that they money is there, and there's proof that the money's there. IE, the risk of 3x damages should be enough to scare the bank into paying out.

Paying _who_ out? Yotta is who the people gave their money to. Yotta then used Synapse (which went bankrupt) to actually deposit the money into not-per-user accounts at 4 different banks. As-in, if you had an account with Yotta your money would be co-mingled with thousands+ other individuals into a singular Evolve account. Evolve has no proof that your money is within the account Synapse held with them. As-in your mo…

> Yotta is speed running the financial system's previous failures.

The theme of the 21st century so far seems to have been “speed running the 20th.”

Re: Synapse still can't find its money

#23

Post by lxgr »

scripturial wrote: post #20
Terr_ wrote: post #4

"We don't know exactly which customer's money went into which bank(s)" gets a bit more spicy when you add the fact all the customers put in $265m and the real-banks only seem to have $180m of it, and AFAIK nobody has a clear explanation for the missing $85m. (~32%) P.S.: I also find it amusing that they stored+hosted their financial ledger using MongoDB. Not that you can't commit massive financial mismanagement with…

I wonder if use of MongoDB creates a legal liability. I’m not up to date on the architecture of MongoDB but I am under the impression that it couldn’t be reliably used for this kind of thing? (The problem here is not nosql, I believe you can do reliable accounting with ScyllaDB and Cassandra as long as you design things correctly. Basically only ever allow append/add but never allow update/delete. I’m not sure if thi…

Where did you get the idea that “append only” needs to necessarily be implemented at the database layer?

Re: Synapse still can't find its money

#24

Post by blibble »

scripturial wrote: post #20
Terr_ wrote: post #4

"We don't know exactly which customer's money went into which bank(s)" gets a bit more spicy when you add the fact all the customers put in $265m and the real-banks only seem to have $180m of it, and AFAIK nobody has a clear explanation for the missing $85m. (~32%) P.S.: I also find it amusing that they stored+hosted their financial ledger using MongoDB. Not that you can't commit massive financial mismanagement with…

I wonder if use of MongoDB creates a legal liability. I’m not up to date on the architecture of MongoDB but I am under the impression that it couldn’t be reliably used for this kind of thing? (The problem here is not nosql, I believe you can do reliable accounting with ScyllaDB and Cassandra as long as you design things correctly. Basically only ever allow append/add but never allow update/delete. I’m not sure if thi…

and this is why I insist on still having paper bank statements

when the k8s+mongodb "non-legacy" tech stack implodes at least I have a physical document the bank produced that the court can understand

Re: Synapse still can't find its money

#25

Post by scripturial »

lxgr wrote: post #23
scripturial wrote: post #20

Earlier quoted context omitted.

I wonder if use of MongoDB creates a legal liability. I’m not up to date on the architecture of MongoDB but I am under the impression that it couldn’t be reliably used for this kind of thing? (The problem here is not nosql, I believe you can do reliable accounting with ScyllaDB and Cassandra as long as you design things correctly. Basically only ever allow append/add but never allow update/delete. I’m not sure if thi…

Where did you get the idea that “append only” needs to necessarily be implemented at the database layer?

No one said that.

The point is it’d be hard to loose data with Scylla as long as your only ever appending to the physical tables. I don’t know if MongoDB has this same attribute.

Re: Synapse still can't find its money

#27

Post by dangrossman »

I followed the "Launch HN" of Yotta 4 years ago and deposited some money.

Evolve Bank says "we have determined that we are not holding your funds and you will not be receiving a payment from Evolve" (reconciliationbyevolve.com)

Yotta customer support says "According to the Synapse Trial Balance Report, your funds are with Evolve Bank & Trust".

It doesn't appear I'll ever be getting that money back. It's not enough that I'll hurt, but it'll make me think twice about trusting a non-bank fintech startup and their "FDIC insured" claims.

This is what Yotta's website looked like in 2020, where "FDIC insured" is the most prominent part of their pitch, and one of the homepage blocks is titled "You can’t lose": https://web.archive.org/web/20200630201639/https://www.withy...

Turns out, we could lose.

Re: Synapse still can't find its money

#28

Post by lxgr »

ctbeiser wrote: post #13
rootusrootus wrote: post #11

The feds need to come crashing down on operations like this. Perhaps you should need to be an accredited investor before you can put your $280K nest egg into a poorly regulated not-bank offering 'prize linked savings' accounts.

The accounts were genuinely FDIC insured. Evolve is a real bank. But a few months before the bankruptcy, Evolve pushed Synapse to move the money into non-FDIC insured brokerage accounts. As far as I can tell, this was: - a way to move a hole in the balance sheet from an FDIC insured to an uninsured place - completely illegal, insofar as the only user consent was a manual opt-out, and some users weren't even sent emai…

Why would they do that? Are you implying that Evolve (and not Synapse) had a hole in their balance sheet? Is there any evidence of that?

Otherwise, FDIC insurance wouldn’t matter here, no?

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