Compound sends $90 million to users by mistake, issues threat

Karthik Subramanian

Compound Labs, one of the first companies to adopt DeFi, has reportedly sent $90 million to its users from its internal system due to a bug in its contract which had recently undergone an upgrade.

This bug resulted in the contract issuing many more COMP tokens than it normally should have and it turned out to be a bug bounty for the users who woke to several million dollars in their account, a total of which accounted for $30 million. The company does not collect the user info and with the transactions being done on the blockchain, where apart from the public address, nothing else about the user is known and so it is going to be difficult for Compound to chase down those users and get its funds back.

This has led Robert Leshner, CEO of Compound, to offer a kind of deal to the users with him promising that those who returned the funds would be rewarded with 10% of the amount of funds returned by them. He also issued a threat saying that those who do not return the funds would be reported to the IRS and would be tracked down and made to pay. This veiled threat could be interpreted to mean that those who returned the funds need not report the funds to the IRS. With the company not collecting any user info, which is one of the primary drivers of the DeFi ecosystem, it is indeed baffling on how the company could say that it would be able to track down the users who received the funds by mistake.

The best that the company could do is to release the addresses of the users publicly so that the company and the blockchain community can track the fund movements and ensure that they would not be able to convert them into fiat at any major exchange and withdraw it as well. This would require the cooperation of the entire crypto community including the exchanges but this has been done before. It has been reported that a couple of users had indeed returned the funds amounting to $12 million but it remains to be seen what the other users, who received the funds by mistake, would choose to do as more and more details emerge about the fund leak in the protocol.

Read this next

blockdag

BlockDAG Dominates with New Dashboard Features and Enhanced Roadmap, Eclipsing Solana and Polygon Developments

Discover how BlockDAG’s cutting-edge dashboard and promising 30,000x ROI outshine developments in Solana and Polygon, positioning it as a leading investment.

blockdag

BlockDAG Dashboard Update, A Step Towards Transparency Fuels FOMO in Crypto Whales, Presale Garners $32.8M Amid Retik Finance Listing

Discover why investors are choosing BlockDAG after its dashboard update and $32.8M presale, surpassing Retik Finance listing on Bitrue.

blockdag

Discover 5 Altcoins to Skyrocket Your Wealth This Cycle 🚀

The bull run of 2024 ignites fresh excitement for anyone looking to increase their wealth.

blockdag

BlastUP Presale Hits $7M; Final Days to Buy $BLP

BlastUP, the premier launchpad on Blast, has confirmed its robust utility by successfully launching its first IDOs. As its presale nears completion, it continues to garner significant attention from crypto enthusiasts. The amount of funds raised so far is approaching 7 million, and BlastUP already boasts a large and passionate community of supporters.

blockdag

BlockDAG Network: The Mobile Mining Revolutionizing Crypto Mining

A Simple Guide on How to Mine BDAG and its Benefits.

blockdag

BlockDAG’s $600M Masterplan Shocks the World: Outperforms Retik Finance After Jaw-Dropping Piccadilly Circus Spectacle

Discover how BDAG dominates the global market as Retik Finance struggles at launch, showcasing a robust $600M growth plan and securing strong investor confidence.

Education

Top Business Ide­as for Success in 2024

Looking for the best busine­ss ideas to start in 2024? Our guide will help you find promising options. We­ cover sectors like digital, we­llness, and green innovations se­t for growth next year. 

Digital Assets

Coinbase seeks to dismiss SEC lawsuit citing new crypto laws

Crypto exchange Coinbase has renewed its efforts to appeal a judge’s ruling in its ongoing case with the U.S. Securities and Exchange Commission (SEC), citing recent legislative developments in Congress.

Digital Assets

Elon Musk mourns Kabosu, Dogecoin responds with price jump

Dogecoin (DOGE) price climbed on Friday after the passing of Kabosu, the Shiba Inu who inspired the meme cryptocurrency.

<