Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls” • Hacker News Board

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#221

Post by nradov » Thu, Dec 16, 2021, 5:45 PM UTC

javajosh wrote: post #196

jeremyjh wrote: post #174

Earlier quoted context omitted.

If that were true, it would not be possible to run a sustainable business in any industry. Legal systems need to generate consistent results with respect to contract law in order for commerce to be successful and efficient.

Cite? No, the way it works is that you pay lawyers who know enough to play it out in their heads and determine who has to pay whom to make it go away. If one side is stubborn and ignorant, then they pull the trigger and the years-long, extremely expensive lottery play has begun. Your assumptions about the law, about judges, and about rationality, rhetoric, and the justice system in general are about to be destroyed.…

The median lawyer salary is $122K. Whether that's ridiculous is a matter of opinion, but it's only a little higher than software developers. And the average lawyer has more education.

Some civil court hearings are already conducted online.

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#222

Post by chrisweekly » Thu, Dec 16, 2021, 5:46 PM UTC

arcticbull wrote: post #207

JumpCrisscross wrote: post #53

The “I have no sympathy for the victims” comments are crass. But there is a legitimate question of how much law enforcement these crimes deserve. Arizona has a stupid motorists law [1]. If a car “becomes stranded after driving around barricades to enter a flooded stretch of roadway,” the driver “may be charged for the cost of their rescue.” A similar concept for crypto may be necessary. Law enforcement will pursue. B…

It’s easy not to have sympathy because these folks are the ones railing against the banks and the government and the establishment and police - confident they don’t need them because they’re all in on a system the vast majority doesn’t understand the first thing about. But they’ll demean and criticize anyone who suggests their magic free money machine might not be all it’s cracked up to be. They’ve been warned so man…

I like your take on it. But 7% inflation? Got a source you could cite?

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#223

Post by babyshake » Thu, Dec 16, 2021, 5:46 PM UTC

arcticbull wrote: post #207

JumpCrisscross wrote: post #53

The “I have no sympathy for the victims” comments are crass. But there is a legitimate question of how much law enforcement these crimes deserve. Arizona has a stupid motorists law [1]. If a car “becomes stranded after driving around barricades to enter a flooded stretch of roadway,” the driver “may be charged for the cost of their rescue.” A similar concept for crypto may be necessary. Law enforcement will pursue. B…

It’s easy not to have sympathy because these folks are the ones railing against the banks and the government and the establishment and police - confident they don’t need them because they’re all in on a system the vast majority doesn’t understand the first thing about. But they’ll demean and criticize anyone who suggests their magic free money machine might not be all it’s cracked up to be. They’ve been warned so man…

Is that really a fact, that 10% of the value locked into DeFi was stolen this year? I would think that most of the TVL would accrue to the more blue chip protocols (Aave, Uniswap, Compound, etc.) and to my knowledge these haven't been affected much by these big hacks.

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#224

Post by kyruzic » Thu, Dec 16, 2021, 5:46 PM UTC

bananabernhard wrote: post #80

kyruzic wrote: post #70

Earlier quoted context omitted.

Use a trusted exchange if you are worried about that. Holding crypto in a wallet is the equivalent of keeping cash in your wallet. No bank in the world will care if someone steals your wallet.

yeah, but then you recreated traditional banking, just as they said. It's almost like there are reasons, as to why things are like they are right now.

No. The person I replied to wanted a traditional bank in the crypto space. I told them how to replicate it.

If you didn't notice the total crypto market cap is 2 trillion dollars. People are happy with the way crypto works, most don't want it to be like a bank, but for those that do there is ways to make it so.

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#225

Post by kristintynski » Thu, Dec 16, 2021, 5:48 PM UTC

vmception wrote: post #74

I think "rug pulls" is not defined well. One example of a "rug pull" is that the team provided liquidity to the AMM liquidity pool, and then removed it, leaving people with no where to trade the token. Its honestly hard for me to call that a scam, although I understand the community expectation being undermined. First: the SEC exacerbates this reality. Tokens that don't want to be considered a security have to consid…

Dogebonk is a good example of a community taking over a token, renouncing contract, locking liq etc. fascinating to see a true community meme engine revving up.

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#226

Post by Jerrrry » Thu, Dec 16, 2021, 5:48 PM UTC

arcticbull wrote: post #207

JumpCrisscross wrote: post #53

The “I have no sympathy for the victims” comments are crass. But there is a legitimate question of how much law enforcement these crimes deserve. Arizona has a stupid motorists law [1]. If a car “becomes stranded after driving around barricades to enter a flooded stretch of roadway,” the driver “may be charged for the cost of their rescue.” A similar concept for crypto may be necessary. Law enforcement will pursue. B…

It’s easy not to have sympathy because these folks are the ones railing against the banks and the government and the establishment and police - confident they don’t need them because they’re all in on a system the vast majority doesn’t understand the first thing about. But they’ll demean and criticize anyone who suggests their magic free money machine might not be all it’s cracked up to be. They’ve been warned so man…

"have fun staying poor," he said, clicking on the coin roulette, eyes never leaving his plugged in android tablet, physically hot to the touch from the max CPU load.

"i am going to retire in 5 years. have you heard of prove-your-steaks? its gonna change crypto. you can get 20% back, just lock up your starving kids Earned Income Tax Credit for a year, and you'll make $500!"

"have you heard of this new shitcoin? probably not - i know you retired from crypto! haha...anyway, it exposes you to upside leveraged of @PISSCOIN and is tethered to the stable-genius coin. its basically free Unisex-swapped tokens."

"hey. some guy on discord was helping me install a chrome plugin to manage my coins and now my $400 in life savings is gone...are you still good with computers?"

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#227

Post by chrisco255 » Thu, Dec 16, 2021, 5:48 PM UTC

DeFi market cap one year ago was probably less than $7B. Now it's over $100B. That is value that has been created.

Crypto is a worldwide, 24/7, permissionless market. It's likened to the wild west. There have been numerous rug pulls, but if you focused all your energy on snake oil salesmen and gangsters in the West, you'd miss the fact that there was real, sustainable value there.

A lot of people left Bitcoin after the Mt. Gox meltdown in 2013. And yet the space continued to evolve and grow.

If you're interacting with DeFi, especially if you're new to crypto, stick with the blue chips like Uniswap, Aave, Compound, and Bancor. They are battle tested.

Look for projects that pay for audits, bug bounties, and do due diligence with regards to security. Don't chase a copycat fork of a popular project on a third rate chain because you feel you missed out.

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#228

Post by ceejayoz » Thu, Dec 16, 2021, 5:49 PM UTC

surfingdino wrote: post #170

ceejayoz wrote: post #9

Earlier quoted context omitted.

Are the scammers now in possession of $7.7B likely to "allocate capital in socially efficient ways"?

They now have a public, cryptographically protected record of their activities, available for inspection using automated tools by anyone who's interested, including law enforcement.

Sure. https://en.wikipedia.org/wiki/Cryptocurrency_tumbler

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#229

Post by BoppreH » Thu, Dec 16, 2021, 5:50 PM UTC

88913527 wrote: post #189

BoppreH wrote: post #24

This is my biggest complaint against cryptocurrencies in general. I'm happy with my bank's fraud protection. How can crypto users protect themselves without recreating traditional banking? Bitcoin was released ~13 years ago, and wallet/transaction security has been one of the most important requirements since then (along with scalability, but let's not go there). If trillion dollar market caps and god-knows-how-many…

There's plenty of situations where traditional banking system does nothing. A social engineering scam led to a 6-figure USD theft, it was a down payment meant to be wired as part of a real estate transaction. The money was already out of the country; they got nothing back. There was a local news article about it.

> 6-figure USD theft

Traditional banking is not perfect by any means, but if 6-figure frauds are making the news, it means they are uncommon. Meanwhile, cryptocurrencies regularly have scams and hacks in the hundred-million dollar range.

Re: Cryptocurrency scams cost owners $7.7B in 2021, driven by DeFi-based “rug pulls”

#230

Post by malermeister » Thu, Dec 16, 2021, 5:51 PM UTC

chrisco255 wrote: post #227

DeFi market cap one year ago was probably less than $7B. Now it's over $100B. That is value that has been created. Crypto is a worldwide, 24/7, permissionless market. It's likened to the wild west. There have been numerous rug pulls, but if you focused all your energy on snake oil salesmen and gangsters in the West, you'd miss the fact that there was real, sustainable value there. A lot of people left Bitcoin after t…

Is it really value that has been created, though? Sure, numbers on computers went up, but is there any value to society in that?