USD 1m in Limbo as DeFi 'Rookie' Sends Funds To Wrong Address
Somebody sent USD 1m to Swerve Finance contract today, with the Cryptoverse initially presuming that the sender would never see their money back. As it turns out, the fortune (pun intended) might be smiling upon the sender at the moment.
In a move which some described as "brutal," an unknown person(s) sent a whopping USDT 1,010,808 (USD 1m) to Swerve Finance token contract. Such smart contracts manage the logic for the tokens and are not meant to hold them.
Swerve Discord is savage tonight. Some guy just sent $1 million to the Swerve token contract and LOST IT ALL.— Platonic NEET (@Crypto_Plato) September 8, 2020
DeFi ain't for the faint of heart. pic.twitter.com/s1OO84i3dI
Dovey Wan, Founding Partner of California-based investment company Primitive Ventures, described this person as a "rookie," asking "why [people keep] sending LP [liquidity provider] fund directly to the governance contract??? How such mistake is even logically making sense?"
Others found that, given the hefty sum, this was likely no rookie, but that the time will show what the transaction was for.
There were even arguments that this is in fact just "a small amount" sent to "test something."
Maybe this was the test transaction? pic.twitter.com/WKJYW3cWRW— Mike van Rossum (@mikevanrossum) September 8, 2020
Luckily for the sender - whom the Cryptoverse 'treated' with a variety of insults - there might be a way out of the situation.
luckily it was tether so our 40 IQ friend might be in luck— Platonic NEET (@Crypto_Plato) September 8, 2020
"Please open a ticket to support service," tweeted Paolo Ardoino, CEO of Bitfinex and Tether (USDT). "If it's [USDT] ERC20 stuck in an address we should be able to recover it, but in order to be sure, please contact our customer support and we'll try our best."
This was a move that many commenters seem to have welcomed, yet prompting a number of age-old discussions.
One of these discussions is concerned with some sort of a safety mechanism that would prevent this sort of things from happening, with some being for such mechanism, saying that one's money needs protection against mistakes, and some arguing against, stating that "if you're playing with this much money you should know better."
Another reopened discussion is that on the merits of centralization.
In this case, centralization is making up for poor design— David Mihal (@dmihal) September 8, 2020
We could easily have built a system where users can't just accidentally burn a million dollars. Instead, we rely on centralization to fix our problems.
As a reminder, Swerve Finance is a fork of decentralized finance (DeFi) protocol Curve Finance, which aims to be community owned and governed. Per DeFi Pulse, Curve currently sits in the fourth place with USD 1bn in total value locked (TLV). Per Swerve, its TLV is USD 411m.