Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

cryptoslate.com

Post reply on HN
Print view View original

551–560 of 577 posts

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#551

Post by G3rn0ti »

akerl_ wrote: post #545
G3rn0ti wrote: post #210

Earlier quoted context omitted.

But there is a price to pay for the responsibility you burden off onto the bank. Banks charge fees, pay almost zero interest (at least currently) and are usually very unpleasant to deal with when you want to borrow money. I’d say it depends. You probably shouldn’t manage your life savings using a crypto wallet. Keep some money at a bank. Keep some money in cryptos. Cryptos are not a solution to every financial proble…

Crypto transactions have fees, crypto wallets don’t accrue interest, and my exchange won’t loan me coins. So I’m not sure this is the slam dunk on banks that you were going for.

> crypto wallets don’t accrue interest

The Coinbase wallet integrates the major lending protocols. Ethereum fees are reasonable these days. So lending USDC or DAI and earning interest has become a great alternative to saving accounts.

If you hold fair amounts of Bitcoin or Ethereum long term, you can use it as collateral and borrow USDC. This way you can not only let your money work for you, you can also use it to borrow dollars for a short term credit — like getting a mortgage but without a bank.

Furthermore, these days there are other emerging financial tools that banks simply can’t provide. Earning exchange fees on liquidity pools, for example, or staking cryptos and earn validation fees like a miner for Proof-Of-Stake networks.

Point is: Lots of innovation, here. When I look at banks nothing really has been happening there for decades.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#552

Post by NicoJuicy »

rawtxapp wrote: post #508
NicoJuicy wrote: post #506

Earlier quoted context omitted.

Who were the victims with wirecard? They faked the numbers, but they didn't manage people's money.

I can't tell if you're sarcastic or not. In case you're serious, you don't see how a company with a market cap of 28B$ going belly up causes damage to investors, the markets, their partners, clients and employees?

The stock going belly up is the consequence of the fraud, but not the actual fraud. Just like the other people you've mentioned.

Eg. Their clients switched payment processor.

When a btc exchange frauds or a coin hacked or a smart contract is bugged, they get away with all your money. Which is the actual fraud.

In some cases they post a postmortem on medium and call it a day.

I don't think wirecard's fraud is comparable with all the crap in crypto town.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#553

Post by raverbashing »

jwlake wrote: post #541
raverbashing wrote: post #62

Earlier quoted context omitted.

Yes, I agree. Most of the security of smart contracts should be in the VM. Things like self-asserting the results and only finishing the transaction if it actually passes a double-check. Or set value limits to each smart-contract (so even if there's a bug it will only operate on 0.00001 BTC for example).

This is mostly infeasible because the VM has no idea what's worth anything. There is no reasonable price in absolute terms for a BTC or ETH or DOGE or $DUMBCOIN. The key is that the contracts need to be minimal and analyzable, so its ~100 lines of code you can manually analyze. Documented separately all the edge cases, or ideally removed through good design so they simply don't exist. A bunch of problems I've seen in…

Thanks for your comment. Yes I agree the absolute value in some coin is not a great metric.

> In normal web/systems programming you have layers of security; In crypto you have none of that.

Yes, that's what I mean. Why not?

> The key is that the contracts need to be minimal and analyzable

Agree, but even short contracts might have bugs. Betting on "self-paying bug bounts" is not a good bet.

What I'm proposing is that every smart contract double-checks its expected results

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#554

Post by CryptoPunk »

ineedasername wrote: post #467
rawtxapp wrote: post #289

Earlier quoted context omitted.

They are called ransomwares and people aren't very happy with that method.

And oddly ineffective at actually prompting action on closing out those bugs.

While I don't have numbers, there is indication that it's prompting increased investment into cyber security:

https://www.forbes.com/sites/kevindowd/2021/06/06/private-eq...

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#555

Post by solomonb »

cylon13 wrote: post #471
solomonb wrote: post #256

Earlier quoted context omitted.

This sounds like a fallacy of the inverse. Those contracts not being hacked yet is no proof that they are resistant to hacks.

It is pretty good evidence that they are resistant to hacks though, and speaking about interesting evidence that doesn't pass the bar of proof isn't some kind of logical fallacy. That's a pretty high bar to set for what you're willing to integrate information-wise about the world into your model of it.

I get where you are coming from but this is a highly adversarial environment where huge amounts of other people's money is at stake with a history of very clever hacks. This looks like precisely the sorts of systems where you ought to raise the bar as high as possible.

Certain systems may have proven themselves somewhat over time but for this I say there is always the possibility for some extremely sophisticated attack and for any other new system they by definition wont have even this proven track record.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#556

Post by solomonb »

Closi wrote: post #400
theli0nheart wrote: post #268

Earlier quoted context omitted.

It's not clear what fallacy you're thinking about because the fallacy of the inverse is not it. From https://en.wikipedia.org/wiki/Confusion_of_the_inverse : > Confusion of the inverse, also called the conditional probability fallacy or the inverse fallacy, is a logical fallacy whereupon a conditional probability is equated with its inverse; that is, given two events A and B, the probability of A happening given that…

The inverse of "any contract that has been hacked was insecure" is "any contract that hasn't been hacked must be secure". I think this is what OP meant. If something has been around for a long time it does probably mean it's less likely there is a really obvious security flaw, but it doesn't necessarily mean it is 'rock-solid' as plenty of things that have been seen to be 'rock-solid' in the past have turned out to b…

yes this is what I was implying. I am curious how else the previous commenter would interpret my statement.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#557

Post by CryptoPunk »

Analemma_ wrote: post #481
mikkelam wrote: post #350

Earlier quoted context omitted.

Some agreed, others didn't and they decided to create a fork. Consensus doesn't require everyone to agree, just the majority

Thank goodness we've gotten away from a system where the government can arbitrarily decide to steal my money and towards a glorious future where a bunch of randos on the internet can arbitrarily decide to steal my money. I feel so much better.

(copy-pasting)

The DAO was a very extraordinary event that occurred under very unique and unrepeatable circumstances.

1. Ethereum had just launched. There was a sense of everything being in beta.

2. The Ethereum stakeholder set was very small, so obtaining consensus for such a controversial hard fork was much easier to accomplish than it would be today.

3. The economy on Ethereum was very small, so

a) a hard fork was far less disruptive than it would be today.

b) an undermining of Ethereum's commitment to neutrality/immutability jeapardized far fewer decentralized application projects than it would today.

4. Smart contracts were completely new, so there was a sense that people could be forgiven for their mistakes.

5. The Ethereum Foundation had promoted the idea of a DAO on their website, and several Ethereum founders had promoted the specific DAO that ended up being hacked. These facts made the DAO appear to be more than a completely third party app.

Ethereum is very different today than it was in 2016, and a DAO-scale mishap would never lead to a hard fork again.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#558

Post by solomonb »

wyager wrote: post #417
solomonb wrote: post #274

Earlier quoted context omitted.

Are there even any dependently typed smart contract languages that would allow you to encode and carry proofs in your contracts? Without that I think the best you could do is model your program in some other formal verification system and then convince yourself that your model matches the actual contract.

The Simplicity language is good. I’m sure there are other designs.

Ok I did a really shallow search of the smart contract space and it looks like the trend is towards creating simple languages that are easy to reason about and formalize their semantics. Simplicity seems to be the best example of this.

With such a language you can write proofs about the behavior of the runtime using some proof checker and then programs in it should be simple enough to reason about in a rigorous way.

What I have not seen and what I am curious about is a smart contract language more in the spirit of Idris. That is to say a more complex language design with full dependent types, which would be a lot more difficult to formalize, but would allow you to do really nice things like treat proofs as first class citizens in your actual smart contracts.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#559

Post by fleddr »

viraptor wrote: post #546
fleddr wrote: post #532

Earlier quoted context omitted.

Fiat money does give you free money. We happen to live in exceptional times where interest rates are close to zero, but in general, simply owning fiat gives you free new fiat. The same is not true for Bitcoin in itself. Nobody wants to help the environment. The typical US lifestyle would require 8 planets if it was rolled out across the world's population. Just leaving your phone plugged in uses more energy than all…

Owning fiat does not give you free money. Giving it to a bank which will pay you interest on the account (or various investments) is what gives you more. But the same applies to BTC with BlockFi / BIA.

You're grasping at straws when you imply people have piles of cash at home whom then "give" it to a bank. It's already in the bank. You get paid directly to your bank account and get additional fiat without a single action on your behalf, with full legal protection. Interest, growing fiat from fiat, is directly integrated into fiat itself.

Not true for Bitcoin. Neither owning your coins in a wallet nor leaving them on an exchange grows your amount of Bitcoin.

Can you give away your Bitcoin to some rogue, fully unregulated party claiming you get back more Bitcoin? Yes, in the same way I can give my fiat to some shady character in the streets. I may get back more fiat. Or I may be permanently parted from my coins.

These things are not the same. Bitcoin does not have interest built in. Not at bank level nor at central bank level. This is radically different from fiat.

Re: SafeDollar ‘stablecoin’ drops to $0 following DeFi exploit on Polygon

#560

Post by viraptor »

fleddr wrote: post #559
viraptor wrote: post #546

Earlier quoted context omitted.

Owning fiat does not give you free money. Giving it to a bank which will pay you interest on the account (or various investments) is what gives you more. But the same applies to BTC with BlockFi / BIA.

You're grasping at straws when you imply people have piles of cash at home whom then "give" it to a bank. It's already in the bank. You get paid directly to your bank account and get additional fiat without a single action on your behalf, with full legal protection. Interest, growing fiat from fiat, is directly integrated into fiat itself. Not true for Bitcoin. Neither owning your coins in a wallet nor leaving them o…

> You're grasping at straws when you imply people have piles of cash at home whom then "give" it to a bank.

Into an interest paying account - yes. A savings account like that may be the "don't even mention it" default for you and me. But not for:

- unbanked people in the US (~6%)

- and in the world (much larger https://www.motherjones.com/kevin-drum/2019/06/raw-data-unba...)

- people with non-interest-paying accounts for religious reasons

- people in countries where interest is ~0% or negative (https://dqydj.com/negative-savings-accounts/)

Post reply on HN