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Tether Rescues $1M USDT Lost in DeFi Smart Contract

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Quick take:

  • On the 8th of September, an investor sent $1M in USDT to the Swerve Smart contract
  • The amount was more or less lost
  • Bitfinex CTO, Paolo Ardoino, advised the owner to open a support ticket with Tether
  • The $1M in USDT was finally retrieved
  • Binance also has a similar case with a user sending 800 BNB directly to a DeFi smart contract
  • Double-checking where we send DeFi funds is highly advised

The DeFi industry is very new and mistakes tend to happen in the form of users sending their funds directly to the smart contract governing the DeFi protocol. On most occasions, the amounts are not insanely high but on the 8th of September, a DeFi user made such a mistake and sent $1 Million in USDT directly to the Swerve Token Contract.

However, Bitfinex CTO, Paolo Ardoino, was quick to notice the event and advised the sender of the funds to open a ticket with Tether. Below is the tweet by Mr. Ardoino advising on the actions to take, alongside the initial tweet highlighting the event of the 1 Million USDT.

Please open a ticket to @Tether_to support service https://t.co/1Yx0v0myL1
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. https://t.co/B3KuRDYsVK

— Paolo Ardoino (@paoloardoino) September 8, 2020

Tether Rescues the $1M USDT Lost

On the 11th of September, Mr. Ardoino updated the crypto-verse that the funds had been retrieved after confirming the identity of the sender. He also provided an Etherscan transaction to verify the transaction. Below is the tweet by Mr. Ardoino updating on the status of the funds.

Use #DeFi projects at your own risk but if you do, at least make sure to user @Tether_to $USDt.

1M $USDt recovered and returned to the legitimate owner(s).https://t.co/dbbbaO3veb https://t.co/j3rkZtx12V

— Paolo Ardoino (@paoloardoino) September 11, 2020

Another DeFi User ‘Loses’ $20k on Binance Smart Chain

Early yesterday, Binance CEO, Changpeng Zhao, also highlighted the plight of a DeFi user who had sent 800 BNB ($20k) to a smart contract address by mistake on Binance Smart Chain. CZ was quick to explain that the funds were literally burned but Binance could refund the user the BNB and deduct them from their quarterly coin burn.

CZ had this to say regarding the mistake by the DeFi user.

A guy just sent 800 #BNB ($20,000) to a smart contract address by mistake on Binance Smart Chain. It is effectively burned (permanently stuck). He’s begging for our help now. We could make him whole by deducting that amount from the next burn. Should we do it?

Will be taken care of.

Double Check Before Sending Funds in the DeFi Ecosystem

What can be learned from these two incidents, is that we should make a habit of double-checking where we send our funds in the DeFi universe.

The two individuals highlighted above were lucky in that they found someone to fix their mistakes. However, high chances are, the next individual will not be as lucky.

Sourced by Ethereum World News

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