[HN Gopher] Canadian math prodigy allegedly stole $65M in crypto
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Canadian math prodigy allegedly stole $65M in crypto
Author : bookmtn
Score : 115 points
Date : 2025-04-14 14:21 UTC (1 days ago)
(HTM) web link (www.theglobeandmail.com)
(TXT) w3m dump (www.theglobeandmail.com)
| nikhizzle wrote:
| So which one is it? Code is contract and he should get to keep
| the money. Or crypto is governed by laws outside of crypto and so
| he violated the "spirit" of the code and hence is a criminal?
|
| It seems like right now the crypto industry makes the decision to
| their convenience on a daily basis.
| intrasight wrote:
| Purity goes out the window when there's real money involved.
| And means that in cryptocurrency, you only own what the
| government grants that you own.
|
| It'll be interesting how this gets resolved by Canadian courts.
|
| And this is rich: "A bad actor not brought to justice and held
| to account for one act of fraud will surely commit another"
| criddell wrote:
| Code is contract and disputes are handled by the courts.
| There's no such thing as a purely extrajudicial contract, is
| there?
| jxjnskkzxxhx wrote:
| We have laws, yes.
| hinkley wrote:
| In the real world locks are meant to keep honest people honest
| and slow down the dishonest people until someone notices and
| stops them.
|
| There's a world where crypto could be sold the same way, but
| the sycophants drowned that out for long enough that we aren't
| in the Trough Disillusionment now so much as the Trough of Open
| Mockery.
| Gunax wrote:
| There definitely some hypocrisy, but it might work differently
| in the law.
|
| As devs, we might claim that 'code is the law' but my guess is
| that the law does not care. That is, one cannot overwrite
| property laws by a few lines of code.
|
| Consider how disclaimers work--we are increasingly putting
| limitations on what rights you can contractually forfeit.
|
| This will be interting to watch.
| amit9gupta wrote:
| He did not steal anything. He beat the fund (Indexed Finance) at
| their own game.
|
| He has not stolen anybody's password, has not modified DeFI code
| - simply executed a set of financial transactions according to
| the rules (expressed as DeFI smart contracts) and profited from
| it.
|
| Indexed Finance is an unlicensed investment firm. The promoters
| knew the risk ( decentralized finance) and now they want to blame
| someone who outsmarted them at their own game.
| Cthulhu_ wrote:
| The company and its customers knew what they were getting into;
| to get protections from the law and guarantees, financial
| institutions need to get licensed and comply with all the
| rules, regulations and law. Of course, this includes providing
| transaction data to the relevant parties to help them detect
| tax evasion and money laundering.
| Aurornis wrote:
| > to get protections from the law and guarantees, financial
| institutions need to get licensed and comply with all the
| rules, regulations and law.
|
| That's not how the law works.
|
| If someone breaks the law or doesn't comply with regulations,
| that's a separate issue. It doesn't entitle a third party to
| steal their funds.
|
| If you were to rob a drug dealer, you couldn't argue that
| they weren't complying with the law and therefore you were
| free to take it. You would both have broken laws.
| archontes wrote:
| Define theft.
|
| If you write a contract and give it to a lawyer with the
| instruction, "Anyone who satisfies this contract gets this
| money." And someone satisfies the contract to the lawyer's
| -but not your- satisfaction, and the lawyer sends the
| money, did the third party steal from you?
| danielvf wrote:
| There's a very relevant XKCD on this, where someone
| discovers a clever "bug" in an insurance contract, and is
| then disappointed.
|
| https://xkcd.com/1494/
| InDubioProRubio wrote:
| But wont somebody think of the Incompetence Finance Inc. - we
| cant have fraudsters defrauded, with legal means. The upper
| caste taketh the lower giveth that is tardition since the dawn
| of time.
| InsideOutSanta wrote:
| This. If you believe in cryptocurrencies, you can't run to the
| courts when people use them as designed, even if they didn't
| use them as intended.
|
| If you end up using the legal system to remediate undesired
| transactions, what's the point of cryptocurrencies in the first
| place?
| thinkingtoilet wrote:
| > what's the point of cryptocurrencies in the first place?
|
| So far, to execute illegal transactions and using the lack of
| regulations to exploit the financially illiterate.
| hinkley wrote:
| Money laundering.
| apercu wrote:
| And get rich quick scams. And fraud.
| smallmancontrov wrote:
| And drugs. And delivery of bribes to the sitting US
| president (these are not the same as illegal transactions
| because when the president does it it is not illegal).
| hinkley wrote:
| Amongst our weaponry are such elements as graft,
| narcotics, money laundering, fraud... I'll come in again.
| eftychis wrote:
| Oh, it is illegal. It's just that the DOJ is turning a
| blind eye because someone at some point wrote a
| "memo"[0,1], which it seems can be the bane of global
| peace and prosperity as we know it. (Yes, it is ironic
| that a memo in some countries like the U.S. can affect
| everyone else.)
|
| P.S. I understand the context in your comment here. Just
| expanding on it for cynicism's sake.
|
| [0] https://biotech.law.lsu.edu/blaw/olc/sitting_presiden
| t.htm [1] https://www.justice.gov/file/146241-0/dl?inline
| [Note it has been updated since 2000.]
| xp84 wrote:
| (i'm not GP but...)
|
| You've cited policy which blocks _prosecution_ of sitting
| Presidents -- but that didn 't necessarily enjoin
| eventual justice from being served after his term(s) end.
| However the outcome of Trump v. United States, 603 U.S.
| 593 (2024) appears to not just block prosecution but
| grant immunity, meaning what would normally be a crime
| ceases to even be a crime.
|
| That ruling appears to draw a nearly complete shield of
| immunity around Presidents for any crimes done as
| 'official acts,' and nearly everything can be claimed to
| be an 'official act' especially given how vaguely-scoped
| much Presidential power has become. I consider it pretty
| unlikely that we'll ever see a former President even be
| charged with a crime if Congress doesn't explicitly
| repudiate this ruling with an actual law.
|
| Source: https://en.wikipedia.org/wiki/Trump_v._United_Sta
| tes#:~:text...
| eftychis wrote:
| Thank you. I tried to keep my comment short, but your
| expansion was necessary on second thought. For better or
| for worse, I expect this to be relitigated. (Unless all
| outgoing presidents start the tradition of pardoning
| themselves from now on.)
|
| The reason is that what constitutes an official act is up
| in the air, and let us be honest, the incumbent president
| is not known for staying inside the Executive branch's
| lane.
|
| But the sheer unwillingness of the DOJ to prosecute,
| creates a catch-22: you need indictments to change or
| clarify Trump v. United States, 603 U.S. 593, and right
| now there are two options:
|
| Somehow revive the private right to criminal prosecution
| (and of the president at that)(See Linda R.S. v. Richard
| D., (1973) 410 U.S. 614 (citations omitted)) or a Federal
| Court to appoint counsel to investigate a former or
| incumbent president. (Young v. U.S. ex re. Vuitton et
| Fils, (1987) 481 U.S. 787.) And I am not sure which one
| is less likely to happen. (Or for Congress to take that
| role beyond impeachment, which is even less likely.)
| thinkingtoilet wrote:
| I posted the original comment everyone is replying to so
| it's clear I'm not fan of crypto. To be fair, literally
| everyone I've ever known, including myself, has only ever
| used cash to buy drugs. I can't put that on crypto.
| timcobb wrote:
| > what's the point of cryptocurrencies in the first place?
|
| Not to be that guy but it seems like the point of
| cryptocurrencies is to scam vulnerable people...
| xattt wrote:
| A wanting of having cake, but a desire to eat it too.
| hinkley wrote:
| Take the cake immediately to your left. Problem solved.
| CursedSilicon wrote:
| The entire idea of crypto is "I wasn't supposed to be the one
| holding the bag!"
| hinkley wrote:
| Musical chairs except you don't want to get a chair.
| what wrote:
| That game is called Hot potato.
| hx8 wrote:
| Funny, I thought the whole point was to hold on to the bag
| as long as you can. Think back to the first time you heard
| about btc or eth, and how much return a modest investment
| would have made. It's the people that sold early that lost
| out.
| vkou wrote:
| How is that theory going for the bagholders of the
| graveyard of dead coins and rugpulls?
| don_neufeld wrote:
| > what's the point of cryptocurrencies in the first place?
|
| I think you're answering your own question here
| vonneumannstan wrote:
| >you can't run to the courts when people use them as
| designed, even if they didn't use them as intended.
|
| I doubt that will hold up in court. The exact thing could be
| said about computer networks and hackers exploiting them.
| jstanley wrote:
| > If you believe in cryptocurrencies, you can't run to the
| courts when people use them as designed, even if they didn't
| use them as intended.
|
| If you believe in cash, does that mean you can't run to the
| courts if someone steals your cash?
|
| If your security proves insufficient to prevent a theft, that
| doesn't mean the theft was legal! It just means your security
| was insufficient.
|
| That security can be enforced by mathematics instead of
| courts is definitely a _benefit_ of cryptocurrency, but when
| it goes wrong courts still matter.
| crote wrote:
| The problem here is that those crypto contracts aren't
| designed to be security. They are intended to be
| _contracts_.
|
| It's like opening a bank account, and the contract says
| "You can only access your own money in the vault.
| Everything you can access is yours to use as you see fit."
| On your first visit the manager brings you into a vault
| with hundreds of cash-laden tables. He shows you to an
| empty table, and says "Here's your table. Enjoy!".
|
| Are you allowed to take money from the other tables?
| Clearly the _contract_ says you can, but surely that can 't
| be what they intended? Is it theft to "break their
| security" by walking over to another table, or is it just a
| hidden perk of the contract you signed?
| notahacker wrote:
| Moreover they're designed to be contracts with the
| explicit intention of enabling trustless exchange
| _without_ third party oversight, under the belief that
| the code can replace a legal system
|
| unlike actual contracts, which are written with the
| expectation that disputes may occur and be resolved by
| arbitrators and a legal system (who will probably rule
| that a poorly drafted clause 2b _doesn 't_ in fact grant
| you the right to take all the other customers' money)
| dandanua wrote:
| @crote
|
| > Are you allowed to take money from the other tables?
| Clearly the contract says you can, but surely that can't be
| what they intended?
|
| If their entire business model is based on giving a service
| that allows you to store your money in safety without any
| government dependency, while in reality they allow everyone
| else to take your money, then they deserve whatever happens
| to them.
| yifanl wrote:
| The fact that they deserve to be bankrupt doesn't mean
| the person responsible for their state of bankruptcy is
| innocent.
| InsideOutSanta wrote:
| _> If you believe in cash, does that mean you can't run to
| the courts if someone steals your cash?_
|
| No, because the point of cash isn't to circumvent
| government control of the financial system. If you build a
| whole system just to decentralize financial control and
| avoid government influence but then appeal to the
| government as soon as you don't like what happens, you're
| doing something wrong.
| hinkley wrote:
| Cash is a fiat currency issued by the government you are
| running to for restitution. I'm not sure GP understands
| what fiat currency means.
| koolba wrote:
| > If you believe in cash, does that mean you can't run to
| the courts if someone steals your cash? If your security
| proves insufficient to prevent a theft, that doesn't mean
| the theft was legal! It just means your security was
| insufficient.
|
| Stealing someone's private key and then using it to steal
| their assets is very different from exploiting edge cases
| of get rich quick schemes.
| Muromec wrote:
| It's different in means, but not in intent. Sure,
| extortion, blackmail and robbery all differ from theft,
| but are illegal all the same
| lelandbatey wrote:
| It's quite different in intent. When you stash crypto
| within a defi contract that _you authored_ , and that
| contract states that the crypto can move under certain
| conditions, and then folks come along and say "hey, I
| meet those conditions" and move the crypto, then no crime
| has been committed!
|
| If you didn't want folks to be able to get the crypto
| under those conditions, then why did you make the
| contract grant them the crypto in those conditions? I
| can't take a stack of $100 bills and leave it on the
| sidewalk with a post-it note saying "only to be picked up
| by John" and then sue the person named John who comes by
| and picks up cash. I also can't get mad when Alice sees
| the stack and tells her friend John to come pick up the
| money with his name on it.
|
| So it is with crypto. Why are you using crypto if you
| don't want to follow the rules? That sounds to me like
| you're trying to do unregistered securities trades...
| tempfile wrote:
| > If you believe in cryptocurrencies, you can't run to the
| courts when people use them as designed, even if they didn't
| use them as intended.
|
| Yes, indeed. And when people leave their home unlocked the
| thieves should get to keep their stuff. What kind of savagery
| is this?
|
| > If you end up using the legal system to remediate undesired
| transactions, what's the point of cryptocurrencies in the
| first place?
|
| Great question, we have been waiting for answers for nearly a
| decade now...
| DangitBobby wrote:
| The entire point of a home is not to escape traditional
| finance. It's by design not compatible with a simple "thief
| breaks into house" comparison, otherwise the entire
| enterprise is a scam and they should be criminally
| prosecuted for fraud the second they ask for legal dispute
| resolution on transactions that happened on ledger.
| InsideOutSanta wrote:
| _> And when people leave their home unlocked the thieves
| should get to keep their stuff._
|
| That's not what happened here. What happened is that the
| crypto company said, "Follow this contract," and their
| customer followed the contract and took their money, and
| then the crypto company was like, "But not like that!"
|
| Ostensibly, the whole point of cryptocurrencies is to
| decentralize financial control and not depend on
| governments for that service. If you then depend on
| governments the second you don't like what happens, there's
| no point to cryptocurrencies.
| tempfile wrote:
| If you can't distinguish "not what I intended" from "not
| what I wanted" then there is probably no reasoning with
| you. Luckily for the rest of us, making this distinction
| is a pre-requisite for becoming a judge or lawyer.
| InsideOutSanta wrote:
| _> Luckily for the rest of us, making this distinction is
| a pre-requisite for becoming a judge or lawyer._
|
| I have to admit, that's pretty funny. But I will point
| out that you did not make an argument in support of your
| position; you merely insulted me.
| tempfile wrote:
| I really didn't intend that as an insult! I just find it
| very easy to distinguish between a case where someone
| followed reasonable rules and got an outcome they didn't
| like, versus a case where someone found absurd rules -
| clearly not intended by anyone - and exploited them for
| an undeserved gain.
|
| If you see a case where someone exploits a badly-coded
| computer program to take a hundred million dollars from
| someone, refuses to return any of it (even when offered
| several million dollars for their trouble), refuses to
| co-operate with the judges and the rest of civilised
| society, and just see "waa waa baby doesn't like his
| medicine" then I don't see how to actually reason with
| you. That's just a value difference, not really an
| insult.
| InsideOutSanta wrote:
| _> I just find it very easy to distinguish between a case
| where someone followed reasonable rules and got an
| outcome they didn't like, versus a case where someone
| found absurd rules - clearly not intended by anyone - and
| exploited them for an undeserved gain_
|
| I think you overestimate how easy it is to distinguish
| between these two. A reasonable common example is people
| like Bernard Marantelli exploiting lotteries. The lottery
| does not intend for people to play as Marantelli does.
| You can (and people do) argue that he's stealing money,
| but should he go to jail for playing the lottery in a way
| "not intended by anyone"? I don't think so.
|
| It's the same with card counters at a casino. The casino
| can throw card counters out because they can decide who
| plays at their establishment, but it would be
| unreasonable to jail card counters for playing blackjack
| in a way casinos don't intend.
|
| _> If you see a case where someone exploits a badly-
| coded computer program to take a hundred million dollars
| from someone_
|
| This phrasing removes relevant context to the point where
| it no longer represents what actually happened.
|
| _> refuses to return any of it (...)_
|
| I did not comment on any of this at all.
|
| _> I don't see how to actually reason with you_
|
| This is dismissive and denies my ability to be convinced
| by reasonable arguments. It is insulting, even if it's
| not intended that way.
| tempfile wrote:
| I think both those cases are easy to decide, and are
| legitimate play. Even if they were not legitimate, I
| think the remedy is simple -- not jail, but at worst
| return the money that was taken. In this case, even if
| deciding the merit of the case is hard, there was a
| transparently reasonable remedy (return 90% of the funds,
| continue with your life) which Medjedovic rejected. More
| than just rejecting the offer, he then went on to launder
| the tokens through a mixer, fled the country, and has
| refused to put the funds in escrow while the case is
| decided in court. None of this is reasonable, in my
| opinion, and I am 100% ok with the legal system forcing
| him to comply.
|
| > This phrasing removes relevant context to the point
| where it no longer represents what actually happened.
|
| I don't think it does, but you don't explain why, so
| there is not much to argue. It is hard to get an
| objective description of what happened, but as far as I
| can tell, the liquidity pools operated by Indexed Finance
| are governed by a smart contract, the smart contract
| contained a mistake, and by exploiting that mistake,
| Medjedovic was able to drain them completely.
|
| Can you explain to me in simple english how that is using
| the contract as intended? Note that "it's what the smart
| contract said" is not sufficient, for the same reason
| that "the web server allowed me to make that request" is
| not a defence against a charge of computer hacking. What
| the smart contract says is actually almost irrelevant.
| What is relevant is what it was _intended_ to do.
|
| Incidentally, why should I be rooting for this guy? It
| seems like literally the only argument in favour of what
| he did here is "everything that is possible is fair". His
| extraction of money is purely parasitic, and aside from
| merely identifying the bug, he hasn't done any useful
| work at all. I would grant that this applies to the
| lottery and card counting examples too. But why should I
| care that he's having his money taken away?
| InsideOutSanta wrote:
| _> I think both those cases are easy to decide_
|
| Many people disagree with you and describe what these
| people do as theft, so it's not as easy as you think.
|
| _> which Medjedovic rejected_
|
| I made no points at all about what he did afterward. This
| is all irrelevant to my point.
|
| _> I don't think it does, but you don't explain why_
|
| I did explain why further up in the thread. It's not just
| a badly coded computer program; it's a badly coded
| computer program _that acts as a contract intended to
| circumvent government control of money._ That 's the
| context.
|
| People agree to adhere to the smart contract instead of
| putting their money into a financial institution that
| uses contracts backed by laws enforced by governments.
| This guy adhered to the smart contract, and when the
| crypto company didn't like the outcome, they decided that
| none of the crypto stuff mattered and that the laws
| enforced by governments mattered after all.
|
| But this makes cryptocurrencies entirely pointless. If
| you can use legal means to circumvent undesired smart
| contract outcomes, then you can just do that in the first
| place and not have the smart contract.
|
| _> Can you explain to me in simple english how that is
| using the contract as intended?_
|
| Yes, of course. Smart contracts are self-executing
| contracts. The agreement you make is written in the code
| of the contract. That is the intention behind a smart
| contract. It makes no sense to say that you did not
| adhere to the contract if it allowed you to do something.
| So by definition, anything you do that the contract
| enables you to do is using the contract as intended.
|
| _> Note that "it's what the smart contract said" is not
| sufficient, for the same reason that "the web server
| allowed me to make that request" is not a defence against
| a charge of computer hacking_
|
| Again, this argument ignores the context of smart
| contracts. Web servers don't claim that their code is a
| contract.
|
| _> why should I be rooting for this guy_
|
| It doesn't matter. I'm not rooting for this guy. I'm not
| arguing emotionally in favor of some guy who did
| something. In fact, I think he's a shithead.
| tempfile wrote:
| > It makes no sense to say that you did not adhere to the
| contract if it allowed you to do something.
|
| I think this is the point where I really disagree with
| you. I don't see how this is different for smart
| contracts, as opposed to, say legal contracts written in
| english. It is not true in general that just because a
| contract says something, that those exact terms are
| enforced. There is a whole body of law around what terms
| are enforceable, what to do in cases of mistakes, and so
| on.
|
| I am now really unclear on what your position is. I
| thought originally that you were in favour of smart
| contracts, and that it was somehow unfair or unethical
| for e.g. a court to rule whether a smart contract was
| intended to do something different than what it did. So I
| am trying to understand why you think it is unethical. In
| this case I think it is unethical to obey the smart
| contract, and that what this kid did is unethical and
| should be illegal. Are you saying what he did is wrong,
| but he should be allowed to do it anyway? If so, why?
| InsideOutSanta wrote:
| _> I don't see how this is different for smart contracts,
| as opposed to, say legal contracts written in english_
|
| It's different because the whole purpose of smart
| contracts is to circumvent governmental power structures.
| Otherwise, people would use regular contracts.
|
| Technologically, it's much easier to set up a payment
| system using a centralized database in a specific
| jurisdiction and have people sign normal contracts to use
| the system. People create cryptocurrency systems to
| _avoid_ that. They put much effort into creating payment
| systems independent of existing power structures. If this
| system does not work without backup from the legal system
| and governmental power, then all that effort is
| pointless.
|
| _> I thought originally that you were in favour of smart
| contracts_
|
| I think they're interesting.
|
| _> Are you saying what he did is wrong, but he should be
| allowed to do it anyway?_
|
| Yes.
|
| _> If so, why?_
|
| Using existing governmental power structures to punish
| people who adhere to smart contracts in ways some system
| members don't like invalidates the whole system. If
| cryptosystems don't work purely technologically without
| judicial support, they don't work, period.
| tempfile wrote:
| I think you're letting the perfect be the enemy of the
| good. It seems like an obvious advantage to have systems
| that decide the outcome automatically and correctly 99%
| of the time, despite requiring occasional corrections
| from outside. That's not the same as a regular contract,
| so it doesn't follow people would always either choose
| smart contracts or traditional ones.
|
| What you're hoping for is, taken literally, impossible.
| Smart contracts can't protect people from fraud, or
| coercion. Since the law _does_ protect them from these
| things, smart contracts cannot be totally isolated from
| the legal system (even if everyone wanted this, which
| they don 't).
|
| > Using existing governmental power structures to punish
| people who adhere to smart contracts in ways some system
| members don't like
|
| Fine, but what about in ways that _the rest of society_
| don 't like?
| InsideOutSanta wrote:
| _> It seems like an obvious advantage to have systems
| that decide the outcome automatically and correctly 99%
| of the time_
|
| That's what traditional systems already do.
|
| _> Fine, but what about in ways that the rest of society
| don't like?_
|
| They don't participate in crypto.
| FireBeyond wrote:
| > Luckily for the rest of us, making this distinction is
| a pre-requisite for becoming a judge or lawyer.
|
| Actually, in many parts of the US, you do not have to
| have any law education to become a judge in district
| courts.
| danielmarkbruce wrote:
| It's like building a home on a land which has no system
| of law because you like anarchy, and then complaining
| when a fellow anarchist steals your stuff.
| BlackFly wrote:
| You'll need a stronger defense than that in court because
| courts absolutely create and deal in gray areas where
| technical fine lines exist.
|
| What you need to argue is that the the smart contracts were
| valid contracts that the creators intended to and had
| opportunity to understand and that their creation was their
| act of negotiation of a position. It isn't really a stretch,
| but with amounts like this probably more diligence would have
| been due than that. Calling it theft is ridiculous on the
| other hand.
| pchangr wrote:
| The point of bitcoin, in words of their creator is to "allow
| online payments to be sent directly from one party to another
| without going through a financial institution." That's it.
| Braxton1980 wrote:
| >cryptocurrencies in the first place?
|
| To get 30mg oxy
| analog31 wrote:
| Money is a technology. Its purpose is whatever use you want
| to put it to.
|
| Like any technology, a money system can be designed so that
| it works well enough for a small set of intended purposes,
| and poorly for all other purposes. Moreover, its uses can be
| constrained by laws.
|
| I think an open question is whether existing laws related to
| money or property apply to cryptocurrencies. For instance,
| "theft" and "fraud" cover a lot of things, without
| specifically listing all of them.
|
| If it's ambiguous whether such laws apply to crypto, then
| sure, someone could use the legal system to settle the
| matter. In fact, using the legal system to remediate
| undesired transactions could be as good a use of crypto as
| any, if "anything goes."
| FireBeyond wrote:
| Yup. Exactly. "The code is law". Well, sometimes you learn
| you're not as good at code as you thought you were.
| -__---____-ZXyw wrote:
| This!? Which? What..? Why!?
| __MatrixMan__ wrote:
| The point of cryptocurrencies is to reward people who make
| hardware available for in-public multiparty computation. The
| point of _that_ is to be able to create rulesets and expect
| that they 'll be followed within the confines of the system.
|
| It's bonkers to me that the only rulesets people care to
| implement on such a platform are just reflections of money as
| we know it. How unimaginative. I wish we'd make something new
| rather than translating something old--bugs and all--into a
| new language.
| BobbyJo wrote:
| Hardware availability is a use case of cryptocurrency, but
| not the point. The point is a decentralized accounting
| system that no single party can manipulate, for good or
| bad. You can apply that to hardware availability, digital
| game economies, supply chain accounting, etc. but the
| _point_ of crypto is more abstract than any of that.
| CPLX wrote:
| I mean you can believe in cryptocurrency. But why do courts
| have to believe in it?
| echoangle wrote:
| Is that how it works legally? If you hack into computers using
| a zero day, did you also just access the computer according to
| the way it was programmed? Just because you can do it
| technically doesn't mean it's not fraud/something else.
| cherryteastain wrote:
| If that's not how it works, where's the line for what is
| fraud and what is not? Once you move away from the "code is
| law" principle, companies have the perverse incentive to
| define fraud as "any transaction that results in negative PnL
| for me", which is exactly what happened here.
| freejazz wrote:
| What does one have to do with the other? Fraud is
| "intentional deception to gain an unfair or illegal
| advantage, often resulting in financial or legal harm" what
| does that have to do with code? What could code even do
| about fraud?
| cherryteastain wrote:
| If fraud is "intentional deception", who did this guy
| deceive? Everything was out in the open.
| freejazz wrote:
| What does that have to do with my question?
| dan-robertson wrote:
| Isn't, in the US system, the definition of fraud built up
| through a combination of legislation and case law from
| previous 'grey area' cases? I think most laws tend to have
| some balance between what is easy to define/understand and
| what is desirable to allow/disallow.
| echoangle wrote:
| ,,Code is law" isn't a thing. Go tell a judge that your
| hacking is legal because the code allowed it. That's not
| something that's allowed by law.
| archontes wrote:
| Imagine I write a contract and empower an AI to execute
| it. I put $10,000 in a bank account and write, "I'd like
| a nice car."
|
| I do this of my own free will, at my own hazard. I know
| I'm playing this game. I have intentionally elected to
| use a system that will execute without any further
| intervention or oversight on my part. Verbally, I state
| that I am confident enough in the writing of my
| instruction that I feel secure in whatever outcome it may
| bring.
|
| The system automatically executes and someone has sold me
| a very nice remote control car.
|
| I sue that person.
|
| Why should I have standing?
| olddustytrail wrote:
| Like buying from eBay?
| cherryteastain wrote:
| I am well aware that "code is law" has no weight in
| actual law. The point I tried to raise was, given the
| following sequence of events:
|
| 1. You deploy a smart contract to the ethereum blockchain
|
| 2. I interact with your smart contract in some manner
|
| how do we define whether the manner of interaction in
| step 2 is fradulent or not?
|
| "Code is law" is one interpretation by crypto enthusiasts
| to define under what conditions interacting with the
| blockchain is fraud; in their definition, it's never
| fradulent.
|
| Let's assume "code is law" is nonsense, as many comments
| here say. Then, under what conditions do we define
| interacting with the blockchain as fradulent? What is
| fraud and what is not fraud?
|
| Edit: In the blockchain we can even formalize this. The
| ethereum blockchain at block K has a certain state S_K. I
| submit a certain transaction/set of instructions T to the
| blockchain which is mined as block K+1. How do we define
| a function isIllegal(S_K, T)? (Assuming block K+1
| contains EVM instructions from my transaction T only)
| danielvf wrote:
| The physical universe advances from state to state, but
| we define still can call certain behaviors illegal.
|
| https://xkcd.com/1494/
| cherryteastain wrote:
| Alright, please go ahead and define under what legal
| pretext this guy's behavior might be illegal.
|
| There are other cases where interacting the blockchain is
| illegal in a very clear manner. Example: if I know an
| Iranian or North Korean entity has the keys to an
| Ethereum wallet, and if I send USDT to that wallet as a
| Western citizen, that is very illegal due to sanctions.
| danielvf wrote:
| There is a US indictment which lays out the basics of the
| which laws Medjedovic is accused of breaking.
|
| https://www.justice.gov/usao-edny/pr/canadian-national-
| charg...
| echoangle wrote:
| You're never going to find a binary function that tells
| you if something is legal or not, in the end it's up to a
| human judge to decide. But imagine setting up a search
| engine and I enter " Robert'); DROP TABLE INDEX; --" as a
| search term. Would you say that's a crime? That's a
| perfectly fine thing to search for, right?
| cherryteastain wrote:
| Yes, perfectly fine, and the fact that you can paste that
| string into this website without being put in prison is
| testament to that!
| Hizonner wrote:
| > You're never going to find a binary function that tells
| you if something is legal or not, in the end it's up to a
| human judge to decide.
|
| ... but the whole point of cryptocurrency, or at least of
| smart contracts and "DeFi", is to reject that and try to
| build a parallel system. That's presumably based on a
| belief that you _can_ write code that behaves the way you
| intend, regardless of whether you really can do that or
| not.
|
| So perhaps the judge should decide "Well, you signed up
| for that when you tried to opt out of having human
| judgement govern your deals. Have a nice day.".
|
| And in fact perhaps there should be formal statutory law
| that makes it clear that's what the judge is supposed to
| decide in any case that isn't itself "borderline"
| somehow. Which the case at hand shouldn't be.
| echoangle wrote:
| If I put up a sign ,,trespassers will be enslaved" on my
| property and then force people who trespass to work for
| me, would that be fine because they knew what they were
| getting into? You can't just create your own justice
| system which contradicts the real one by making
| contracts.
| Hizonner wrote:
| You _can_ give away your money by making contracts.
| IanCal wrote:
| > ... but the whole point of cryptocurrency, or at least
| of smart contracts and "DeFi", is to reject that and try
| to build a parallel system.
|
| No, it isn't. It might be some peoples desire around it,
| but by no means all (or even most).
| Hizonner wrote:
| It doesn't add any other value whatsoever, so I'm having
| trouble with that assertion.
| mschuster91 wrote:
| > Let's assume "code is law" is nonsense, as many
| comments here say. Then, under what conditions do we
| define interacting with the blockchain as fradulent? What
| is fraud and what is not fraud?
|
| The thing is, laws can have issues and bugs as well, just
| like code! And we have courts to judge not just when
| someone outright breaks a law but also when someone is
| skirting on the edges of the law.
|
| Take Germany's "cum ex" scandal for example. Billions of
| euros were effectively defrauded from the state and on
| paper the scheme appeared legally sound, but in the end
| it was all shot down many years later because the actions
| of the "cum ex" thieves obviously violated the spirit of
| the law.
|
| The only difference is that blockchains are distributed
| worldwide and there is no single entity that can be held
| accountable and forced to execute or reverse any given
| transaction.
| TimPC wrote:
| The context is completely different though. Building a
| normal computer app is not an attempt to do anything
| without government or legal structures so it makes sense
| that normal computer apps would be protected by
| government or legal structures.
|
| It doesn't really make sense for people to build smart
| contracts that are intended to be an extra-judical
| agreement where the code enforces the rules and then run
| to government whenever something they don't like happens.
| What is the purpose of smart contracts at all if you
| still need the entire legal apparatus around them?
|
| What does agreeing to a contract that inherently implies
| trying to work around the need for government in
| contracts means? What does it say about intent?
|
| If for example, the firm that lost money had been saying
| "Code is Law" in their previous pro-crypto statements and
| had explicitly talked about smart contracts being extra-
| judical it seeems there intent would be to avoid legal
| intervention entirely and it would require a fairly high
| bar to argue that any bug could result in a lawsuit.
| cellis wrote:
| It may not pass muster with a judge in some backwater,
| but with one in the Northern District of California or a
| jury of their HN peers, it might. Laws are what we make
| them.
| crispyambulance wrote:
| He should have taken the significant and generous 10% bounty
| the first time around. He now has to face law suits by well-
| funded finance firms.
| DangitBobby wrote:
| It seems like he simply faces a very wealthy existence in
| countries that don't give a shit about US laws.
| knodi123 wrote:
| Assuming he can get his hands on the tokens and then
| convert them to local currency. Not impossible, but it's
| worth noting that he still hasn't managed.
| Aurornis wrote:
| > He did not steal anything. He beat the fund (Indexed Finance)
| at their own game.
|
| As popular as this idea is online, it doesn't work that way in
| the courts.
|
| Intent matters in issues of the law. The "finders keepers"
| rules don't apply in legal matters in the real world.
|
| If someone logs into their bank and notices that changing the
| account number in the URL lets them withdraw from other
| people's accounts, no court is going to shrug it off and say
| that it's the bank's fault for not being more secure. Likewise,
| finding a vulnerability in a smart contract doesn't
| automatically give someone the right to any funds they collect
| from exploiting it.
|
| We all know the "code is law" arguments about smart contracts
| are just marketing bluster. The lawyers do, too.
| mjr00 wrote:
| The big difference is that those are centralized systems
| owned by corporations, and accessing them in a way which
| you're not supposed to, such as by changing a bank account
| number or exploiting a zero day, is a crime.
|
| With DeFi it's different; the code is public and
| decentralized. There was no unauthorized access to anything
| here. From my reading of what was done, it was essentially
| taking advantage of the poor trading strategy of Indexed
| Finance.
|
| I'm not going to pretend to be a lawyer, but I don't see a
| lot of parallels between this and e.g. using SQL injection to
| obtain unauthorized access to a system.
| ajb wrote:
| I'm not a lawyer either, but I suspect the technical
| structure is not determinative. Contract law has certain
| features. These technical constructs purport to enable
| contracts to be written and executed such that subsequently
| the courts cannot but find that what the code did is final
| and there is no possible legal reconsideration. Clearly,
| this is the prior expectation of the parties, but whether
| it is the case under all circumstances is a function of
| contract law (and other applicable law) not the technical
| constructs. The code is not what will finally be
| determinative.
|
| To give an analogy, it's like writing code in a high level
| language and saying that it will prevent side channels such
| as spectre. But such side channels are a function of the
| hardware, not the high level language. The hardware in defi
| is ultimately the law, not the servers.
| Hizonner wrote:
| The _intent_ of the whole underlying system is that the
| _intent_ of all the parties be described by code of the smart
| contracts. Which are _intended_ to be composable, _intended_
| to be used in unanticipated ways, and _intended_ to operate
| independent of any human oversight. The system is also
| _intended_ to avoid all ambiguity by enforcing the contracts
| exactly as described by the code... and to provide certainty
| of transactions and prevent them from being undone after the
| fact.
|
| Everybody involved knows all of that, and claims it as a
| positive feature of the system. At least until they find out
| that it's actually hard to write bug-free code.
|
| There may indeed not be a legal "meeting of minds" (although
| there very well also _may_ )... but from an _ethical_ point
| of view, everybody involved knowingly signed up for _exactly_
| that kind of risk. And honestly it would be good _public
| policy_ if the law held them to it. Otherwise you get people
| trying to opt out of the regular legal system up until it 's
| inconvenient.
|
| There'd be more of a case if he'd exploited the underlying
| EVM implementation. But he didn't. He just relied on the
| "letter" of a contract, in an environment that everybody had
| _sought out_ because of unambiguous to-the-letter
| enforcement.
| stouset wrote:
| The entire point of cryptocurrency contracts is supposedly
| that "code is law". Running to the courts as soon as someone
| does something you didn't intend only highlights that people
| don't actually believe this.
| ceejayoz wrote:
| We've known this since Ethereum forked in the DAO debacle.
| stouset wrote:
| We have, it's just yet another counterexample that tanks
| the arguments of True Believers.
| ipsento606 wrote:
| > If someone logs into their bank and notices that changing
| the account number in the URL lets them withdraw from other
| people's accounts, no court is going to shrug it off and say
| that it's the bank's fault for not being more secure
|
| When you open a bank account, there is an actual contract and
| regulatory framework that governs how you use the account. A
| URL parameter is an implementation detail that no more alters
| the contract than a broken lock on a vault would alter the
| contract.
|
| But when you interact with a smart contract, the smart
| contract _is the contract_. What you are allowed to do is
| defined by what the smart contract lets you do. You don 't
| need to open an account, agree to T&Cs or sign any other sort
| of contract to interact with the smart contract.
|
| If the smart contract is not the contract, how would you
| propose we can determine what the real contract is?
| danielvf wrote:
| The camera shows night in the Wild West.
|
| A masked man creeps through the shadows of a sleeping town.
|
| He looks both ways, then uses a knife to unlatch a door from
| the outside. He slips into near pitch blackness. He moves
| confidently in the darkness - he's worked for this bank before,
| checking on their security from theft.
|
| Out comes his lock picking tools - the bank president's office
| door opens with a quick rake. Cheap lock.
|
| Inside, with no windows to betray him, he lights a candle.
| There in the corner stands the safe. He knows it inside and
| out, and has been practicing. Five minutes later, the lock is
| picked, and he loads up the gold, cash, and bonds inside.
|
| He puts the candle out, slips back outside, and returns to his
| room at the lodging house, climbing in through the window.
|
| The next morning, with the discovery of missing gold, the town
| looks like someone kicked over a fire ants nest. It only takes
| 30 minutes before people start wondering about "bank security
| expert" who had just been in the bank every day.
|
| A crowd heads over the boarding house, growing in size as it
| goes.
|
| "Did you steal our money?", they ask?
|
| "ABSOLUTELY NOT," he replies, "I merely used my immense mental
| powers to out hink several flawed physical security measures,
| breaking no laws of physics, in such a way that the gold, cash,
| and bonds previously belong to you are now in my possession,
| and now belong to me. No theft has taken place, only the
| movement of certain levers, of which anyone who knew how could
| move, and the movement of afterwords of certain goods."
|
| "So you stole our money!!", the town shouted.
|
| "No, no, I just interacted with the universe according to its
| very own publicly available rules. No theft has occurred!"
|
| An old cowhand, covering him with double barrel, spoke up,
| "Walll, guess he's right. We deserved to lose all that money.
| He did nothing wrong at all."
|
| Everyone left, impressed with his genius.
| DangitBobby wrote:
| Yes, running transactions for asymmetric benefit allowed by
| code on a platform underpinned by a technology whose
| proponents espouse "code is law" is at all comparable to a
| man picking a lock on a bank safe. Very astute.
| danielvf wrote:
| In this case the only person espousing the idea of "code is
| law" is the hacker. Neither the blockchain's builders, nor
| the hacked protocol, nor the users are saying that.
|
| "code is law" is a meme that primarily lives on hacker
| news. Only a tiny fraction of crypto people believe it or
| say it.
| ceejayoz wrote:
| This is revisionist history.
|
| https://www.bitget.com/news/detail/12560604358718
|
| > In April 2016, in Switzerland, the Slock.it team was
| introducing their ambitious plan: The DAO, a
| decentralized investment fund governed entirely by code.
| "Imagine a fund with no board, no CEO," founder Christoph
| Jentzsch explained, "all decisions are made by token
| holders through smart contract-based voting. This is the
| ultimate realization of 'Code is Law'."
|
| https://x.com/VitalikButerin/status/1188511660387889153
| olddustytrail wrote:
| Is the "Slock.it team" not a tiny fraction of crypto
| people?
|
| I find it difficult to believe they're a large majority.
| ceejayoz wrote:
| The DAO was not some small, fringe project in the crypto
| world.
|
| Per Wiki:
|
| > As of May 2016, The DAO had attracted nearly 14% of all
| Ether tokens issued to date.
|
| Vitalik Buterin is, uh, pretty notable, too.
| meepmorp wrote:
| > The camera shows night in the Wild West.
|
| > A masked man creeps through the shadows of a sleeping town.
|
| > He looks both ways, then
|
| ... walks into a casino, realizes there's a flaw in how they
| shuffle and deal cards, and then makes a shit ton of money
| exploiting this weakness.
|
| After losing a shit ton of money because they didn't plan for
| someone to play the game in an unexpected way, the owners of
| the casino demanded the money back.
|
| "Did you steal our money?", they ask?
|
| "ABSOLUTELY NOT," he replies, "I didn't get any non-public
| information, I didn't manipulate the deck, and you have yet
| to point to a single hand that was not played entirely within
| the stated rules of the game. You're just mad because I
| noticed that you fucked up and bet accordingly."
| olddustytrail wrote:
| They all beat the shit out of the asshole and took their
| money back.
|
| "There's always another moron tries that one", they laughed
| as they walked away.
| Yizahi wrote:
| Code is lol. Oh, sorry, meant to say Code is Law. :)
| moralestapia wrote:
| Indexed Finance's mistake was not being Vitalik Buterin and
| then putting on a sad face and ask for the shitcoin to fork to
| a version where they didn't screw up.
| sksxihve wrote:
| Code is law went out the door with the ethereum hardfork after
| the dao hack.
| stefan_ wrote:
| Funny, because it would never have happened if it was court
| ordered.
| darepublic wrote:
| The code is law thing is a grey area. But I am open to the idea
| that this young man did not break any rules, just found flaws
| in the system. In the same way that card counting should not be
| against the law just because it resulted in the house being
| disadvantaged. These things should be addressed with patches to
| the rules, not legal action.
| cherryteastain wrote:
| My personal belief is that this was not fraud and "Code is Law"
| works. Yet, this guy is a perfect example of how intelligence and
| wisdom are not the same. He was clearly smart and dedicated
| enough to pull off this sort of trade successfully multiple times
| in a row, and probably all he had to do to get away with it was
| keeping his mouth shut. Or at the very least not get convicted by
| default on contempt of court charges by ignoring a court summons.
| neuroelectron wrote:
| Court was outside its jurisdiction here. The fact that the case
| went forward shows that he was about to be railroaded by
| corrupt authorities.
| cherryteastain wrote:
| Agree, but the wisdom here is in recognising that once you
| made $65m in seconds at someone else's expense they will try
| to recoup that amount by any means necessary.
| neuroelectron wrote:
| He isn't working completely alone. He was able to borrow
| some "wisdom" and skedaddle.
| steve_adams_86 wrote:
| It is a good example. Unfortunately most 18 year olds don't
| possess a whole lot of wisdom yet. This guy was basically a kid
| when he did this.
| hinkley wrote:
| That German general who talked about keeping stupid industrious
| people away from your armed forces never met a clever enough
| fool.
|
| Clever fools are how you get Jurassic Park.
| perihelions wrote:
| Previous thread,
|
| https://news.ycombinator.com/item?id=31478795 ( _" The math
| prodigy whose hack upended DeFi won't return funds"_ (2022) --
| 399 comments)
| tlogan wrote:
| Code is not law. Law is law.
| pixelpoet wrote:
| law : code :: word problem : mathematical notation
| freejazz wrote:
| Has that been your experience interacting with the law?
| tomrod wrote:
| :::goedel's incompleteness theorem
| m101 wrote:
| How this works in traditional finance is that the big funds would
| screw the small guy that beats them (especially if they're from a
| foreign country). They claim that they use unfair or illegal
| practices, but the reality is that they're not that different to
| their own.
|
| Ultimately the rules are written by people who look legitimate,
| and/or those who capture regulators.
| kazinator wrote:
| You can't "steal" crypto; it's all just a scam that operates
| outside of the law.
|
| I mean, sure, we can use the language of theft and crime
| figuratively, just like when we talk about animals. For instance,
| "the wolf stole a chicken from the coop".
| tim333 wrote:
| The case of SBF suggests you can and it's not outside the law
| enough to prevent 25 years of jail.
| neuroelectron wrote:
| "The house always wins," is the law he broke.
| perdomon wrote:
| Based on this article, it doesn't sound like he did anything
| illegal (initially). He saw an opportunity and took advantage of
| it not unlike high frequency trading in the late 90s/early 2000s.
| Decentralized markets operate in a space that's inherently risky
| -- if they don't want to get exploited, hire better engineers or
| get out of the game. Begging the government for help when you got
| bested isn't how decentralization works.
| Sonnigeszeug wrote:
| Contract is code, you don't need anything anymore. It solves all
| the problem.
|
| _Something happens_
|
| We need to use the system which we want to replace...
| TrackerFF wrote:
| One universal law is that if you steal from people with more
| money than you, you're screwed. And the more money they have, the
| worse off you are.
|
| But on a serious note, whenever you read about some people that
| have either managed to outright steal crypto, or find some
| vulnerability which hasn't been legality tested...and they just
| pack their bags, hoping to live life free, forever after. It just
| seems so naive, too naive with how smart these individuals
| otherwise tend to be.
|
| I think it is fair to say that once you'll cross a threshold,
| could be a million. could be 10 million. could be 50 million. All
| depends on who you've taken it from, you'll realistically be
| hunted for life.
|
| The people that do get away with these things, are state
| sponsored operators - but they don't walk away with tens of
| millions in loot, either.
|
| EDIT: Reading the article, this guy sounds like a real piece of
| work.
| dandanua wrote:
| > One universal law is that if you steal from people with more
| money than you, you're screwed. And the more money they have,
| the worse off you are.
|
| If someone has more money than you, you're screwed. Period.
|
| This is how it works in the fascists world order, which is
| increasingly dominating these days.
| throwway120385 wrote:
| If you want to know the future of humanity, just imagine a
| bot stamping on a human face forever.
| archontes wrote:
| I can't tell if this is a typo or not, and it's perfect.
| racl101 wrote:
| I thought it was deliberate. Clever play on an Orwell
| quote nevertheless. Hmmmyes.
| CPLX wrote:
| From 1984 to 2024
| tempfile wrote:
| "Code is Law" is a profoundly immature idea, and I am surprised
| anyone other than children take it seriously. The law is not, and
| never has been, something that is read literally and taken at
| face value. This is the entire reason that judges and lawyers
| exist.
|
| Saying "The code let me do it, so it should be legal" is a bit
| like if I leave a "free to a good home" sign on a plant pot
| outside my home, and it leans on my car. It does not mean you are
| permitted to take my car, no matter how "obvious" it seems to you
| that it should.
| Dumblydorr wrote:
| Someone who disagrees with you is a profoundly immature child?
|
| Your analogy is confusing, you're comparing a free plant on the
| roadside to 63 million dollars on a crypto exploit?
| tempfile wrote:
| Not always, just in this case :-)
|
| What's actually confusing in the analogy? Are you actually
| confused or just pretending? The point is that just because a
| sign says something under a literal reading, it doesn't mean
| that it's what was intended, or what's binding. If there's a
| piece of paper on my car saying "free to a good home", I
| _probably_ didn 't intend that you can take my car (or my
| house, or whatever). It's not very different to the fact that
| a 0-day exploit on your bank's web server does not entitle
| the thief to your money.
| jxjnskkzxxhx wrote:
| A lot of people who disagree with me also happen to be
| profoundly immature child. I didn't say that one follows from
| the other, you added that.
| throwway120385 wrote:
| just in case though, I usually hang the sign on signposts in
| the public right of way in case someone tries to steal my car.
| thomassmith65 wrote:
| This was satisfying to read: "Code is not law.
| Law is law," Mr. Gottlieb wrote in a lengthy thread to Mr.
| Medjedovic on X in late October, 2021. "And what you did was
| not a 'clever trade.' It was market manipulation. It's illegal.
| And people go to prison for it."
|
| Tech exceptionalism is eternal. It takes the occasional Napster
| or PirateBay failure to disabuse a generation in the tech
| community of the triumphalist nonsense it talks itself into
| believing. But then the next generation comes along and doesn't
| know better.
| lelandbatey wrote:
| While satisfying, that quote is also hilariously one-sided in
| it's perspective. I imagine that lawyer in the courtroom
| saying something like the following:
|
| > Yes, my client did take a stack $100 bills and leave it on
| the sidewalk atop an elaborate contract proclaiming that
| those $100 bills should be given to the very next person
| going by the name of "John" who found this stack of $100
| bills upon the sidewalk, including specific language stating
| that anyone, even an unforeseen party meeting such criteria,
| would be entitled to that money. And indeed, my client signed
| and dated that document in triplicate. Yes my client did go
| to great lengths to write such a detailed and specific
| contract, and he was quite sure that such a contracts terms
| would be sufficient to ensure that only my clients brother,
| John Williams, would be entitled to the money, that same John
| Williams who lives across town. The brother would never find
| that money though, because the villainous, criminal, thief of
| a man _John Smith_ stole that money from off the sidewalk
| when walking out of Smiths front door! Smith would have you
| believe that he was _merely_ fulfilling the terms of a
| fortuitous open ended contract foolishly entered into by an
| idiot who failed to think critically about the terms said
| idiot entered into. That, however, is not important! I am
| here today to say that the terms of such a contract are not
| what is relevant, what is relevant is how upset my client is
| that he no longer has his money. I can prove that Smith stole
| that money, no matter what the documents signed by my client
| say! Those contracts are not law, only the law is law. What
| Smith did was not a "clever deal", it was theft. Which is
| illegal, and people go to prison for it.
|
| A bit over dramatic, but that's how the lawyers statement
| reads to me.
| prvc wrote:
| The entire space of smart contracts falls within the intended
| functionality of the systems that implement them, which make this
| particular use of them conceptually unlike things like buffer
| overflows.
|
| Calling it a "hack" or an "attack" as this article does (while
| strawmanning the opposite case) is a deliberate attempt to muddy
| the waters, and is a failure of journalism.
| neuroelectron wrote:
| It reminds me of the Sam Bankman-fried case, but it also quite
| different. SBF thought the abstractions would protect him from
| the law when he clearly was misleading investors and using code
| to abstract away his fraud. However, in this case, the code/fraud
| was presented and used as intended. While I believe SBF was
| innocent of defrauding his early investors who were foolish to
| trust such a system, he was guilty for other reasons.
|
| Andean Medjedovic's case shouldn't have even made it to court and
| he had no obligation to leave his crypto or cashed out legal
| tender with some "custodian" and spend the next several years of
| his life as a beta tester for establishing case law. This wasn't
| just "code is law," more accurately, "under the stipulations of
| the contract, code is law."
| BlackFly wrote:
| He should have accepted their offer of 10% as a bug bounty.
| Certainly crypto folk love to act like unregulated markets but
| this smells like market manipulation to my armchair education and
| even if the market tries to play both ways, the courts won't. I
| do hope that the Ontario court fights the extradition, because
| the American laws leveled at him seem bogus by Canadian standards
| (wire fraud, extortion and money laundering) but that tort case
| might be legit.
| danielvf wrote:
| My favorite is one of the text files on the attacker's computer:
|
| A file labeled "Decisions and Mistakes," in which he wrote,
| "Going On the run / Yes / Chance of getting caught<Payoff for not
| getting caught / (NA) / Risk is typically underpriced in modern
| world.
| rozap wrote:
| Wait, I thought cryptocurrencies aren't securities? Why are our
| tax dollars being spent investigating this? If they're not
| securities (like coinbase etc would like us to believe), then he
| didn't do anything wrong and there are no other rules - code is
| law. If they are securities, then why are there so many illegal
| exchanges operating in plain sight?
|
| Once again, crypto folks are all about decentralization until
| someone outsmarts them, then they go crying to daddy government
| to bail them out.
| wmf wrote:
| This doesn't change the big picture but some are securities,
| some are commodities, and some are collectibles.
| Barrin92 wrote:
| I'm not entirely sure what makes you think there's no financial
| regulation or laws you can break outside of securities trade,
| because there is and which is why he's charged with wire and
| commodities fraud, Hobbs Act extortion and money laundering.
|
| Code is not law, the law is the law.
| commandersaki wrote:
| Similar situation with two brothers that gained millions on
| Ethereum by coercing bots:
| https://www.arnoldporter.com/en/perspectives/blogs/enforceme...
| moktonar wrote:
| Placing trust on software is the root of all evil..
| netvarun wrote:
| https://archive.is/kVsvc
| stainablesteel wrote:
| the movie about this guy is going to be awesome
| baq wrote:
| Just another day of crypto bros speedrunning finance.
| ForHackernews wrote:
| > Not everyone agrees. "Code is not law. Law is law," Mr.
| Gottlieb wrote in a lengthy thread to Mr. Medjedovic on X in late
| October, 2021. "And what you did was not a 'clever trade.' It was
| market manipulation. It's illegal. And people go to prison for
| it.
|
| Boy the crypto industry better pray that market manipulation
| isn't illegal in DeFi-world or they're all going to prison.
| egypturnash wrote:
| _They are part of the team representing Cicada 137 LLC_
|
| I wonder if this is any relation to Cicada 3301.
| https://en.wikipedia.org/wiki/Cicada_3301
| msvcredist2022 wrote:
| almost definitely a relation in name only
| TrapLord_Rhodo wrote:
| "The silver lining to all of this is that Trump promised to stop
| the persecution of crypto people," Mr. Medjedovic wrote on
| Signal. "Like, half of the people involved in this
| resigned/stepped down recently."
|
| Very interesting that he gives praise to trump after all this
| hassle from the US government. Why is the US even involved in
| this? It's a canadian dude and a canadian exchange.
| lamadruga wrote:
| How do these people get caught? Isn't crypto supposed to be
| anonymous or something?
| ycombinatrix wrote:
| Some coins are designed to provide a degree of anonymity.
| Bitcoin & Ethereum do not.
| ryao wrote:
| The article says "he took credit for it on the social media
| platform X".
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