Compound cryptocurrency platform accidentally distributed $160 million of Ethereum

Compound distributed Ethereum to users
Written by Emma Davis

The decentralized Compound platform mistakenly distributed around $160 million worth of Ethereum cryptocurrencies to users. Now the founder of the platform asks users to return the funds, otherwise he threatens to report them to the IRS and arrange doxing.

Bleeping Computer writes that the $ 160 million accidental “giveaway” of Ethereum occurred at the end of last week due to an error during a protocol update and a bug in a smart contract. For example, the transaction history of the Comptroller contract shows where the tokens went.

It is worth noting that user funds, provided assets and borrowed assets were not affected by the failure, and, as the developers wrote: “the only risk is that you (or another user) will receive an unreasonably large amount of COMP.” At the same time, according to the journalists of The Register, “extra” tokens are not even displayed in the user’s account automatically, in order to receive them, you need to do a number of manual manipulations.

Shortly after the crash, Compound founder Robert Leshner reached users and urged them to return the funds received in error into the Timelock contract. To stimulate the community, Leschner said that users can keep 10% of the funds as a reward, but noted that the rest of the company will be forced to report to the IRS and doxing will occur.

If you received a large, incorrect amount of COMP from the Compound protocol error: Please return it to the Compound Timelock (0x6d903f6003cca6255D85CcA4D3B:5146dC33925). Keep 10% as a white-hat. Otherwise, it’s being reported as income to the IRS, and most of you are doxxed.Robert Leshner on his Twitter wrote.

Many users did not like Leschner’s threats:

Wow … this is just a shame – a request wrapped in a threat caused by a lack of privacy.blockchain engineer Assaf Morami was quoted as saying by journalists

After that, the head of Compound changed tactics and explained that the previous tweet was really stupid, he just wanted to “help the community return at least some of the COMP.”

Now the Compound developers have to wait for when (and if) the users will return the erroneously allocated funds. Judging by Leschner’s tweets, as of October 3, 2021, platform users returned about 117,000 tokens, that is, about $ 38.7 million.

Interestingly, according to blockchain specialist Mudit Gupta, Compound’s multimillion dollar error was a simple one-character typo in the smart contract code.

Let me remind you that we also talked about the fact that Monero cryptocurrency official website was hacked and distributed malware.

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About the author

Emma Davis

I'm writer and content manager (a short time ago completed a bachelor degree in Marketing from the Gustavus Adolphus College). For now, I have a deep drive to study cyber security.

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