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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?

#481

Post by awb »

ssiddharth wrote: post #5

In case you’re wondering what happened, from the thread: He sent ETH to the WETH contract, received WETH as expected. Then he wanted to do the reverse and sent WETH, but will not receive anything, because you're supposed to swap your WETH to ETH in exchanges like Uniswap, or call the "withdraw" function in the contract. For contracts that want to only work with ERC-20 tokens, you use WETH, which comes from a contract…

> A known problem with ERC-20 tokens is that transferring them to a contract that isn't made to access them is equivalent to burning them.

Is this a bug or a feature?

Re: Did I just lose half a million dollars?

#482

Post by RedShift1 »

noduerme wrote: post #287
RedShift1 wrote: post #128

Earlier quoted context omitted.

The thing is that is not an invalid transaction. The problem is in what happens _after_ the smart contract has received the money.

As far as Ethereum is concerned it's valid, but the contract API is riding on top of Ethereum's blockchain. It's middleware. It's responsible for enforcing the contract. How does it have a giant black hole in it?

It's the same as you and I agreeing on a contract where it says when you send me money, I will burn it. If you then use a bank transfer to me, it's not the bank's fault your money is gone, we agreed on that contract and it's not the bank's business to deal with that. Doesn't mean that there shouldn't be safeguards, there absolutely should be, but just laying out where the responsibilities start and stop and the whole deal with crypto currency is the absence of central control so if you choose to shoot yourself in the foot, you're free to do so. But freedom of action doesn't mean freedom of consequences and in the case of a blockchain, it's forever.

Re: Did I just lose half a million dollars?

#483

Post by UncleMeat »

bigtex88 wrote: post #464
afidrya wrote: post #60

Earlier quoted context omitted.

In simple words, he should have called a smart contract's function which would withdraw his tokens and send real ETH to his address. Instead, he sent tokens to smart contract's address and they will stay there forever, not associated with any account. This complexity should be abstracted away by wallet's UI. Users don't have to call APIs directly. Also, this whole situation could be prevented by trying to send a smal…

In simple words, he should have done what everyone else does and used Uniswap or Zapper or Sushi or ANY exchange and swapped WETH for ETH that way. This is just a dumbass user doing dumbass things. This is basic-level stuff right here. Don't interact with contracts directly unless you 100% know what you're doing.

But people are allowed to interact with smart contracts. To obtain the WETH he needed to do that. This is a "why do we even have that lever" kind of situation. If my brokerage had a "permanently burn all of your money" button then it wouldn't be reasonable to just say "well, people shouldn't push that button."

We can even see this with the criticism of wire fraud. Wire fraud is a huge fucking mess that occasionally costs people their life savings. The entire setup is rightly criticized (heck, even by the crypto community) for having users interact with a highly error-prone system with huge consequences.

Re: Did I just lose half a million dollars?

#484

Post by SilasX »

Rastonbury wrote: post #403
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 (…

This is what stresses me out the most about crypto. The supposed gold standard is a hardware wallet and access is done via 12-word recovery phrase but even that is sketchy. If I'm not wrong all an attack has to do is get recovery phrase and load it into another hardware wallet if they don't have mine, this is functionality is there if the hardware wallet fails. If I've been doxxed and have several mil in crypto, thie…

Also, in ten years you won’t know what to do with the 12 words because the application was abandoned and when you try to install it you get some error messages from npm about certain dependencies being deprecated.

Re: Did I just lose half a million dollars?

#485

Post by tinco »

SamReidHughes wrote: post #400
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 (…

You write down the N different Shamir passphrases of your hierarchical deterministic wallet on paper and store them in N different locations. Or for longevity and fire resistance, use metal foil and a punch.

-

Re: Did I just lose half a million dollars?

#486

Post by jmull »

rosndo wrote: post #14
wruza wrote: post #9

Is this a motivation issue with crypto? Here is what I mean. Centralized systems work like a web of tunnels - you can’t send “nowhere” or make a huge mistake, but if your part of a tunnel gets shut for some reason, you’re locked. Decentralized ones are like an endless empty void with point-like islands of ownership in it. You can send anywhere, but make one mistake and it’s over. Now pepper this with our usual issues…

>Centralized systems work like a web of tunnels - you can’t send “nowhere” or make a huge mistake You can totally make a 1 digit typo while making a bank transfer that results in all the money being lost. Perhaps you’ll recover it after years of litigation, but that’s really not guaranteed. https://www.theguardian.com/money/2019/dec/07/i-lost-my-1930... E: downvoted by upset bankers? :)

This is a really good case against crypto.

In the crypto case of this thread, the OP made a mistake and there's no process to fix it. 100K's lost. There's no avenue for recovery.

In the banking case of your link, the man made a mistake and was able to correct it, despite the bank working against him. 100K's lost and recovered.

In the case of the bank, it sure wasn't perfect and definitely should be better. But ultimately, the bank not only paid to recover the money, but the banking system (according to the article) is at least promising a fix for the underlying issue that a simple mistake in writing digits can lead to missending funds.

Also: crypto is touts its trustless nature as a positive. But note that trust is the lever Mr. Teich used to get Barclays to pay the cost of recovering the funds. Barclays only paid after their reputation was threatened, and of course, trust is based on reputation.

Re: Did I just lose half a million dollars?

#487

Post by capableweb »

halfmatthalfcat wrote: post #476
capableweb wrote: post #430

Earlier quoted context omitted.

The only thing you're showcasing here is the lack of understanding of what happened. This transfer was a transfer from one address to another. No one has ever wanted to do that? It's the entire point of cryptocurrencies!

And this mentality is what will block wider adoption of crypto. Calling people dumb for not understanding a non-intuitive system (after there's so much prior, "return to sender" art in the world) will not get them to use crypto.

Sure, I have no desire for cryptocurrency to get a wider adoption, I have no skin in the game, I'm just looking at the facts. I don't care if the space burns up or saves the world, for me is the same.

This is not the case of a non-intuitive system screwing the user. This is the user purposefully avoiding using the intuitive systems setup for them, and interacting with something directly even though no one does that unless you're a developer. This person has half a million dollars worth of X, while not understanding X.

> (after there's so much prior, "return to sender" art in the world)

That's awesome that you have come up with a solution for this, while the ecosystem hasn't been able to. Could you share your solution?

It's a hard problem to solve in a system that has to A) be decentralized, B) work when less than half the network is trying to screw you and C) prevent double-spending

"return to sender" sounds easy to implement in a centralized system, but it's not that simple for a decentralized one. At least not until you release your solution.

Re: Did I just lose half a million dollars?

#488

Post by awb »

masklinn wrote: post #79
hughrr wrote: post #26

Earlier quoted context omitted.

The problem with crypto is despite your explanation, I have no idea what any of your post means. Not any of it.

From what I understood of afidrya explanation (in a sub-comment): * there's a smart contract to which you can send ETH (directly), it sends WETH back * however the inverse operation (WETH -> ETH) is not done by sending the WETH, you're supposed to call a special conversion function of the contract I guess the smart contract only looks for ETH in its wallet (at its address), it ignores the WETH entirely, and thus the…

> but if you deposit a bank check it just shreds the check.

Why would you ever want to “shred the check”? Is this the intended functionality or a bug?

Re: Did I just lose half a million dollars?

#490

Post by TingPing »

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 (…

It would be years before an SSD starts degrading.
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