Crypto Company Accidentally Gives Users $ 90 Million And Asks For It In Return

If someone accidentally deposited millions of dollars into your bank account, what are the chances that you would simply return it? What if the person who sent it to you requested really good?

This is the predicament in which users of the Popular Decentralized Finance (DeFI) Staking Protocol Compound laboratories are currently facing. In recent days, the platform has accidentally deposited arbitrary amounts of crypto into the accounts of some users. The total payout, which was provided via a bug in a company update, now stands at around $ 89 million. As a result, the CEO and founder of the platform, Robert Leshner, is begging for reimbursement.

Leshner took to Twitter on Thursday to plead with users to return the millions distributed in error, even suggesting that those who returned the funds could “keep 10%” as a reward for doing the right thing. If the users don’t return the money, Leshner threatened, it would be “reported as income to the IRS, and most of you are doxed.”

The compound is a crypto lending platform, allowing both investors and borrowers to exchange assets without the traditional services of a bank. Such platforms have been called risky, given the lack of regulatory guarantees that protect traditional banking services, and this recent episode seems to show why.

The money was apparently released via an error in what was supposed to be a standard upgrade to Compound’s smart contract (such contracts are used to facilitate crypto transactions). Instead, the alleged flaw inundated some users with “far too much” COMP — the. native encryption token. A person, for example, claim they received about $ 20 million from COMP at one time.

Platforms like Compound have already experienced this kind of thing. In May, crypto lender BlockFi accidentally sent distributed around $ 20 million in Bitcoin to its users and subsequently begged to get it back. Soon after, another lender, Alechemix, suffered a similar problem.

Leshner then reconsidered his threat to dox users who would not return the funds.call the “bone head” idea. The doxxing is widely considered a huge betrayal in the crypto world, given the industry’s ethics on privacy, anonymity, and security.

As financial experts who talked to CNBC seem to imply, there is no legal obligation for the recipients of the payment to return it.

Interestingly, a decent number of users appear to be accepting the CEO’s request to return the funds, as Leshner can be seen thanking various people on Twitter:

Yes, 0x2e4a, good sir, I salute you too. If someone sent me $ 20 million, my first order of business would be to go to the nearest ATM, or the nearest crypto exchange, so to speak. We’ve reached out to Compound for feedback on this whole situation and will update our story if they respond.