6 common mistakes when working with crypto that lead to losses
The infamous "fat-finger" error reminds us that, yes, despite its futuristic appeal, the crypto sector is very much prone to human mistakes. A fat-finger error basically refers to a misstep that a user makes in sending, selling, or receiving crypto by inputting some form of incorrect information due to a typing error. Usually, such kinds of errors tend to cost many investors a fortune.
While the so-called fat-finger errors do occur outside of crypto, too, one key difference in crypto is the fact that transactions are irreversible and anonymous, leaving limited options to be made for recovery.
Crypto Mix-Up Recipients Go All-In on Millionaire Lifestyle
In May 2021, Crypto.com accidentally transferred 10.47 million Australian dollars to an Australian couple instead of a 100 AUD refund. The error arose from an incorrect entry of an account number into an Excel spreadsheet. By the time it was discovered, the couple had already spent the money on buying houses and giving it away as gifts. The couple was later sent to prison after pleading guilty to theft.
$23.7 Million Gas Fee Mises Ends up with a Good Samaritan Miner
In September 2021, the DeFi platform DeversiFi paid $23.7 million as a gas fee due to a glitch in the EthereumJS library and the EIP-1559 upgrade. Thankfully, the miner who received the fee returned it, keeping only 50 ETH as a reward for his honesty. Ethereum's blockchain transparency enabled DeversiFi to track down the miner and request the return.
DeFi Bug Hands Out $90 Million in COMP Tokens
In October 2021, due to a bug in its protocol update, Compound Finance users were able to claim $90 million in COMP tokens. Despite public requests from founder Robert Leshner, some beneficiaries chose not to return the tokens, underscoring the challenges of decentralization. The error highlighted the lack of control in DeFi distributions, as there is no admin tool to reverse the payout.
700 BTC Promo Makes Temporary Millionaires
In May 2021, BlockFi mistakenly credited Bitcoin instead of stablecoin GUSD to users as part of a promotional scheme. Some users ended up receiving as much as 700 BTC. While most transfers were returned, around 100 users kept the funds transferred in error, causing reputational damage to BlockFi. This operational mistake added to BlockFi’s woes, and the company eventually filed for bankruptcy in November 2022.
Suspicious Fat-Fingers
Sometimes, "fat-finger" errors may be intentional. A case in point occurred in August 2023, when a user paid $90,000 in gas fees for a $2,200 Ether transfer, raising suspicions of money laundering. Crypto staking firm Northstake recently reported illicit activity in Ether staking, sparking concern among financial institutions.
Standard Clumsy Fat-Finger Mistakes Will Always Exist
Not all fat-finger errors are worth millions. NFT collector PrincePablos once accidentally purchased an NFT for 0.21 BTC instead of the intended 0.021 BTC, instantly multiplying his cost tenfold. Although it resulted in a loss, this mistake turned PrincePablos into a “fat-finger celebrity,” serving as a cautionary tale to check transaction details.
More about technology
View all
Blockchain against AI fakes: Protecting crypto distributions
AI Bots seem to be everywhere, from social media to online gaming. For example, in crypto gaming, it is quite common to use bots to "grind" through tasks in games or even fake user activity to qualify for crypto airdrops. The problem is that while some bots are fairly obvious in their repetitive actions, AI technology is advancing rapidly, making it harder to distinguish fake from real accounts.
Web3 and artificial intelligence: How AI is transforming crypto projects
This article will explore how AI can be put into operation within a Web3 and crypto project, illustrating examples from AI-enhanced smart contracts to data analytics and even locking up critical security mechanisms.
A Comprehensive Guide to the Bear Flag Pattern for Traders
In the bustling world of trading, mastering technical analysis is key to making informed decisions. One essential pattern to familiarize yourself with is the Bear Flag Pattern. This guide will walk you through understanding, identifying, and trading this powerful pattern as part of your trading strategies.
Understanding MetaMask: Your Gateway to the Blockchain
In today's rapidly changing world of cryptocurrency and blockchain technology, having the right tools is essential for managing your crypto assets and interacting with decentralized applications (dApps). One tool that stands out is MetaMask
DeFi vs CeFi: Understanding the Differences
In the realm of cryptocurrency and blockchain technology, two distinct financial systems take center stage — Decentralized Finance (DeFi) and Centralized Finance (CeFi). Both systems provide avenues to manage, trade, and grow your assets, yet they operate on different core principles.
What Does DCA Stand For in Cryptocurrency?
Are you new to cryptocurrency investing? You might have heard about DCA, a key strategy that can significantly impact how you manage your investments in the volatile world of crypto. But what does DCA really mean, and how can it benefit your investment approach?
Simplifying Automation with GraphLinq's Instant Deploy Wizard: No Coding Required
In the rapidly evolving world of blockchain technology and decentralized finance (DeFi), automation has become crucial for efficiency and scalability. However, traditional automation often requires extensive coding knowledge, making it inaccessible to a large number of users.
How to Simplify the Creation of Smart Contracts and DApps on GraphLinq Chain: Rapid Deployment Without Coding
The world of blockchain technology is expanding rapidly, and with it, the demand for decentralized applications (DApps) and smart contracts is on the rise. However, many developers and businesses are deterred by the complexity of coding and technical expertise required to develop on traditional blockchains.
.jpg)
The Legal Status of Cryptocurrencies: Are They Securities or Commodities?
Cryptocurrencies have taken the world by storm, transforming traditional finance and introducing new ways of conducting transactions, raising capital, and investing. However, with this rise in popularity comes a critical question that regulators, investors, and businesses must face: Are cryptocurrencies securities or commodities?
%20How%20to%20Find%20New%20Cryptocurrencies%20%20Worth%20Investing%20In.jpg)
%20Understanding%20Cryptocurrency.jpg)
Understanding Cryptocurrency
Cryptocurrency is a digital or virtual currency that uses cryptographic principles to secure transactions and control the creation of new units. Operating on decentralized networks, cryptocurrencies are typically underpinned by blockchain technology, a distributed ledger maintained by a network of computers (nodes).
Understanding Bitcoin Halving: An In-Depth Exploration
Bitcoin halving is a significant event that occurs approximately every four years within the Bitcoin network. During this event, the reward that miners receive for adding new blocks to the blockchain is cut in half, reducing the rate at which new bitcoins are introduced to the marke
.jpg)
A Guide to Understanding Crypto Tokens
Crypto tokens are dynamic digital assets created on existing blockchains like Ethereum. Unlike cryptocurrencies, which serve as the native currency of a blockchain, tokens are used within decentralized applications (dApps) for various functions such as facilitating transactions, representing ownership, or storing value.
A%20Comprehensive%20Guide%20to%20Altcoin%20Season.jpg)
A Comprehensive Guide to Altcoin Season
While Bitcoin remains the most well-known and widely adopted cryptocurrency, altcoins provide opportunities for diversification and specialization in sectors ranging from decentralized finance (DeFi) to privacy-focused transactions.
%20cases%20and%20Future%20of%20Ai%20in%20Crypto.jpg)
Cases and Future of Artificial Intelligence (AI) in Crypto
Artificial Intelligence (AI) and cryptocurrencies are revolutionizing the tech landscape. Imagine the decentralization and security of crypto combined with AI's unparalleled data analysis and pattern recognition capabilities. This dynamic duo is poised to bring about groundbreaking innovations across various sectors.
%20How%20to%20Create%20Your%20Own%20MetaMask%20Wallet.jpg)
How to Create Your Own MetaMask Wallet
MetaMask is a popular browser extension that allows you to store Ethereum and other ERC-20 tokens securely. This free and secure extension enables web apps to read and interact with the Ethereum blockchain. MetaMask is a hot wallet, meaning it stores your cryptocurrencies online. Users can send cryptocurrencies and interact with many decentralized apps using this browser plugin.
%20How%20to%20use%20your%20Crypto%20wallet%20safely.jpg)
How to Use Your Crypto Wallet Safely
With the recent ETF win and possible increased Bitcoin and Ethereum mass adoption, securely managing your crypto assets has never been more critical. Cryptocurrency wallets are essential for responsible digital asset management, allowing you to store, receive, and send coins and tokens securely. However, not all wallets offer the same level of reliability and security.
What%20is%20a%20smart%20contract.jpg)
What is a Smart Contract? An Overview of Smart Contract Technology
In today's fast-paced digital landscape, smart contracts have emerged as a revolutionary force, transforming how transactions and agreements are conducted. Built on blockchain platforms, these self-executing contracts combine traditional contract principles with the efficiency, transparency, and security of decentralized ledger technology.
%20How%20to%20Protect%20Against%20Crypto%20Scams%20and%20Ponzi%20Schemes.jpg)
How to Protect Against Crypto Scams and Ponzi Schemes
Navigating the intricate world of cryptocurrency trading can often feel daunting, especially with the lurking threat of crypto scams and Ponzi schemes. In the revolutionary realm of cryptocurrency, opportunists always seek to exploit vulnerabilities and defraud unsuspecting investors.
Understanding Crypto Bridges and Cross-Chain Transactions
Curious about how cryptocurrencies can transition seamlessly between different blockchain networks? The key lies in crypto bridges. Whether you're new to cryptocurrency or intrigued by its workings, this guide will clarify the concept of crypto bridges and illustrate how they facilitate cross-chain transactions.
The Integration of AI in Crypto: A Revolutionary Partnership
Artificial Intelligence (AI) and cryptocurrencies are revolutionizing the tech landscape. Imagine the decentralization and security of crypto combined with AI's unparalleled data analysis and pattern recognition capabilities. This dynamic duo is poised to bring about groundbreaking innovations across various sectors.
How to Secure Smart Contracts from Hacks
Smart contracts are changing how businesses operate in the blockchain realm. These self-executing contracts, with agreement terms embedded directly in lines of code, are powerful tools but are not immune to cyber threats. In recent years, the blockchain community has seen multiple high-profile smart contract hacks, leading to significant financial losses.
How to Avoid DeFi Hacks
Blockchain technology has revolutionized the financial sector, leading to the rise of Decentralized Finance (DeFi). DeFi enables peer-to-peer lending and borrowing without needing traditional banks, providing individuals with more control over their finances and increasing accessibility to financial services.
Build Your dApp with Lua Script. Step-by-Step Guide to Developing the Dextool Trending Tokens Sniper Bot
Developing dApps can seem daunting, especially if you're not familiar with programming languages. However, mastering these languages unlocks their true potential. Among these, Lua Script stands out as a crucial tool.
7 Reasons Why Your Business Needs Blockchain Technology
In today’s rapidly evolving technological landscape, businesses continuously seek ways to enhance security, transparency, efficiency, and cost-effectiveness. Blockchain technology, the backbone of cryptocurrencies, has emerged as a game-changer that can significantly improve your business operations.
The Ultimate Smart Contract Audit Checklist
Building a smart contract is like constructing a complex machine—exciting and innovative, but risky. Just as you wouldn’t launch a rocket without rigorous checks, your smart contract needs a thorough audit before interacting with real money or assets.
How to Use MetaMask with Graphlinq: A Complete Guide
MetaMask is a familiar name in the web3 and crypto space. It is one of the most popular Ethereum wallets, serving as a bridge between standard web browsers and the Ethereum blockchain, including Ethereum-compatible chains like Polygon, BSC, and more.
Fighting Spam and Scams in the Crypto World: A Real-Life Cautionary Tale
While I would not have been buying a snipe bot online, the length this person went to confirm it wasn't a scam is serious. Would you have fallen for it?