20 ms·

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 exec

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_ 1y ago
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 1y ago
  > 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 1y ago
    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 1y ago
      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/ https://xkcd.com/1494/
InDubioProRubio 1y ago
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 1y ago
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?
- don_neufeld 1y ago
  > what's the point of cryptocurrencies in the first place? I think you’re answering your own question here
- thinkingtoilet 1y ago
  > 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 1y ago
    Money laundering.
    - apercu 1y ago
      And get rich quick scams. And fraud.
      - smallmancontrov 1y ago
        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 1y ago
        Amongst our weaponry are such elements as graft, narcotics, money laundering, fraud… I’ll come in again.
echoangle 1y ago
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 1y ago
  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 1y ago
    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 1y ago
      If fraud is "intentional deception", who did this guy deceive? Everything was out in the open.
      - freejazz 1y ago
        What does that have to do with my question?
  - dan-robertson 1y ago
    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 1y ago
crispyambulance 1y ago
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 1y ago
  It seems like he simply faces a very wealthy existence in countries that don't give a shit about US laws.
  - knodi123 1y ago
    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 1y ago
> 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 1y ago
  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 1y ago
    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.
danielvf 1y ago
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 1y ago
  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 1y ago
    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.
Yizahi 1y ago
Code is lol. Oh, sorry, meant to say Code is Law. :)
moralestapia 1y ago
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 1y ago
Code is law went out the door with the ethereum hardfork after the dao hack.
- stefan_ 1y ago
  Funny, because it would never have happened if it was court ordered.
- Calwestjobs 1y ago
  (realizing that im so old. if this is what i totally forgot, what else of this magnitude of signifince i do not remember anymore. that i was part of/ was involved/ it affected me.)
- aqme28 1y ago
  This makes no sense. I agree with you that code is not law, but the incident you're talking about wasn't law but community-driven consensus.
darepublic 1y ago
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.
- Calwestjobs 1y ago
  be careful with card counting, most casinos do "business" in such way that there is NO advantage for player. no matter what player does. so all american youtube sagas about doing card counting in PRESENT time are fraud to dupe people into thinking that it is possible to card count. NOW TODAY.
  - StanislavPetrov 1y ago
    Card counting is still possible (albeit a bit harder) in the present day - the mathematics are the same. Most casinos use more decks and don't deal as deeply into the shoe, but it is still entirely possible to gain a statistical edge over the house, which is why casinos will still ban you from playing blackjack if you are playing with an advantage(counting, varying your best sizes greatly based on the count, sitting out and watching until the deck gets deeper, ect). They will never ban you from games like Roulette, where you there truly is no way to gain an advantage over the house regardless of what strategy you use.
    - reaperman 1y ago
      > Roulette, no way to gain an advantage over the house regardless of what strategy you use. These days that’s probably true but it has been done: https://www.roulettestar.com/people/joseph-jagger/ https://www.roulettestar.com/people/joseph-jagger/
      - selcuka 1y ago
        He was a smart man: > After the second day, Jagger kept a clear head and decided that enough was enough, and left Monte Carlo to head home to Yorkshire with his winnings. > When he got home, he retired from the Mill and invested some of his winnings into property.
gamblor956 1y ago
In the real world, code is not law. Computers are not a magical gateway to another reality where existing laws and rules no longer apply. What matters is if Medjedovic engaged in activities that would be illegal in the process of acquiring the funds from Indexed Finance. A theft is theft whether it is physical or digital; victims aren't required to have perfect security and criminals are not allowed to exploit weaknesses to just take something that belongs to someone else. Medjedovic is accused of exploiting "glitches." From a legal perspective, that would be no different from a thief exploiting a "low" wall or an unsecured window. Glitches aren't invitations any more than an open window. In other words...not a defense. (And in the U.S., specifically see the Avraham Eisenberg case, which is basically the same fact pattern. Eisenberg lost. His sentencing was postponed to last week but appears to have been postponed again.) Then he skipped town after he was ordered by a court to put his tokens into escrow. If he truly believed that "code is law" and that the tokens were rightfully his, he wouldn't have skipped town. At that point...his own actions demonstrated that he didn't believe that what he did to acquire the tokens were legit. (The Fugitive notwithstanding, innocent people don't run.) Then he "exploited glitches" for another DeFi. See above. Then he attempted to launder the tokens...with some guy he found on the internet. Someone who legitimately believed that they legally owned the tokens would have hired lawyers, not money launderers, to gain access to their property. (Aside: any money launderer willing to launder money for a stranger is almost certainly undercover law enforcement...) Then he moved to a country without an extradition treaty, and in the past few months has been spouting racist far-right nonsense in the hopes of getting pardoned. Is he guilty? His own actions say that even he thinks he is.
- garfield_light 1y ago
  Irrelevant, his thoughts in the matter or him being a shithead don't make the unintended use of a smart contract illegal or not. This is just usual case of Wilhoit’s Law by shitcoin peddlers. > There must be in-groups whom the law protects but does not bind, alongside out-groups whom the law binds but does not protect. They are outside of regulatory scrutiny but god-forbid someone uses the same excuses to take their funny money.
- poochkoishi728 1y ago
  He can believe the tokens are rightfully his, and still believe that authorities don't see it his way. Like if you're in Salem and know you're not a witch, you'd want to take off too and chill in no-extradition treaty countries, so you don't get boiled alive by people with different outlooks. I like the analogy of an unsecured window. It doesn't seem to apply to a hypothetical (idk specifics of this company) purely private company in some crypto-friendly country that doesn't have any ties to the rule of law.
TacticalCoder 1y ago
https://www.justice.gov/usao-sdny/pr/former-security-engineer-sentenced-three-years-prison-hacking-two-decentralized https://www.justice.gov/usao-sdny/pr/former-security-enginee... From that link: "U.S. Attorney Damian Williams said: “Today, Shakeeb Ahmed was sentenced to prison in the first ever conviction for the hack of a smart contract and ordered to forfeit all of the stolen crypto. No matter how novel or sophisticated the hack, this Office and our law enforcement partners are committed to following the money and bringing hackers to justice. And as today’s sentence shows, time in prison — and forfeiture of all the stolen crypto — is the inevitable consequence of such destructive hacks.” The undisputable matter of fact is this: there have already been several cases of people who thought they could invoke the "(smart contract) code is law" argument to outsmart judges and the legal system. But that's fantasy. In practice these people, when caught, go to prison. > 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. And DeFi exchanges are "unlicensed brokers". And yet I posted a case where the hacker who "outsmarted" them is now in prison: how smart one has to be to end up in prison right? Post me a case where an "unlicensed investement firm" sued a thief who "outsmarted them" and where the judge decided to let the thief walk free. For I posted a case from justice.gov to prove my point.
programjames 1y ago
Next we're going to learn that winning Poker Bots with an "all in" strategy is defrauding the competition.
cvoss 1y ago
This is a tiresome argument. Stealing is a moral concept first, and a legal concept second. You can steal without breaking any laws, the same way you can be a bad person without breaking any laws.
PaywallBuster 1y ago
https://www.coindesk.com/policy/2024/04/18/mango-markets-exploiter-avi-eisenberg-found-guilty-of-fraud-and-manipulation https://www.coindesk.com/policy/2024/04/18/mango-markets-exp... Avi Einsenberg did the same with Mango Markets, got away with 110M and is now looking at 20 year sentence And Mango was being sued by the SEC too https://www.sec.gov/newsroom/press-releases/2024-154 https://www.sec.gov/newsroom/press-releases/2024-154 > SEC Charges Entities Operating Crypto Asset Trading Platform Mango Markets for Unregistered Offers and Sales of the Platform’s “MNGO” Governance Tokens > Pair of affiliated entities separately charged for acting as unregistered brokers
KoolKat23 1y ago
It depends if acted in accordance with the terms of the contract then it's fine but if he did something not covered by the contract it's theft. If I run an unmanned lemonade stand out front and leave a pile of money on the table, and say take your change, if you take more than what you're owed that's theft regardless of how easy it was.

Cthulhu_ 1y ago

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 1y ago
> 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 1y ago
  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 1y ago
    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/ https://xkcd.com/1494/

InDubioProRubio 1y ago

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 1y ago

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?

don_neufeld 1y ago
> what's the point of cryptocurrencies in the first place? I think you’re answering your own question here
thinkingtoilet 1y ago
> 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 1y ago
  Money laundering.
  - apercu 1y ago
    And get rich quick scams. And fraud.
    - smallmancontrov 1y ago
      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 1y ago
        Amongst our weaponry are such elements as graft, narcotics, money laundering, fraud… I’ll come in again.

echoangle 1y ago

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 1y ago
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 1y ago
  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 1y ago
    If fraud is "intentional deception", who did this guy deceive? Everything was out in the open.
    - freejazz 1y ago
      What does that have to do with my question?
- dan-robertson 1y ago
  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 1y ago

crispyambulance 1y ago

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 1y ago
It seems like he simply faces a very wealthy existence in countries that don't give a shit about US laws.
- knodi123 1y ago
  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 1y ago

> 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 1y ago
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 1y ago
  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.

danielvf 1y ago

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 1y ago
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 1y ago
  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.

Yizahi 1y ago

Code is lol. Oh, sorry, meant to say Code is Law. :)

moralestapia 1y ago

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 1y ago

Code is law went out the door with the ethereum hardfork after the dao hack.

stefan_ 1y ago
Funny, because it would never have happened if it was court ordered.
Calwestjobs 1y ago
(realizing that im so old. if this is what i totally forgot, what else of this magnitude of signifince i do not remember anymore. that i was part of/ was involved/ it affected me.)
aqme28 1y ago
This makes no sense. I agree with you that code is not law, but the incident you're talking about wasn't law but community-driven consensus.

darepublic 1y ago

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.

Calwestjobs 1y ago
be careful with card counting, most casinos do "business" in such way that there is NO advantage for player. no matter what player does. so all american youtube sagas about doing card counting in PRESENT time are fraud to dupe people into thinking that it is possible to card count. NOW TODAY.
- StanislavPetrov 1y ago
  Card counting is still possible (albeit a bit harder) in the present day - the mathematics are the same. Most casinos use more decks and don't deal as deeply into the shoe, but it is still entirely possible to gain a statistical edge over the house, which is why casinos will still ban you from playing blackjack if you are playing with an advantage(counting, varying your best sizes greatly based on the count, sitting out and watching until the deck gets deeper, ect). They will never ban you from games like Roulette, where you there truly is no way to gain an advantage over the house regardless of what strategy you use.
  - reaperman 1y ago
    > Roulette, no way to gain an advantage over the house regardless of what strategy you use. These days that’s probably true but it has been done: https://www.roulettestar.com/people/joseph-jagger/ https://www.roulettestar.com/people/joseph-jagger/
    - selcuka 1y ago
      He was a smart man: > After the second day, Jagger kept a clear head and decided that enough was enough, and left Monte Carlo to head home to Yorkshire with his winnings. > When he got home, he retired from the Mill and invested some of his winnings into property.

gamblor956 1y ago

In the real world, code is not law. Computers are not a magical gateway to another reality where existing laws and rules no longer apply. What matters is if Medjedovic engaged in activities that would be illegal in the process of acquiring the funds from Indexed Finance. A theft is theft whether it is physical or digital; victims aren't required to have perfect security and criminals are not allowed to exploit weaknesses to just take something that belongs to someone else. Medjedovic is accused of exploiting "glitches." From a legal perspective, that would be no different from a thief exploiting a "low" wall or an unsecured window. Glitches aren't invitations any more than an open window. In other words...not a defense. (And in the U.S., specifically see the Avraham Eisenberg case, which is basically the same fact pattern. Eisenberg lost. His sentencing was postponed to last week but appears to have been postponed again.) Then he skipped town after he was ordered by a court to put his tokens into escrow. If he truly believed that "code is law" and that the tokens were rightfully his, he wouldn't have skipped town. At that point...his own actions demonstrated that he didn't believe that what he did to acquire the tokens were legit. (The Fugitive notwithstanding, innocent people don't run.) Then he "exploited glitches" for another DeFi. See above. Then he attempted to launder the tokens...with some guy he found on the internet. Someone who legitimately believed that they legally owned the tokens would have hired lawyers, not money launderers, to gain access to their property. (Aside: any money launderer willing to launder money for a stranger is almost certainly undercover law enforcement...) Then he moved to a country without an extradition treaty, and in the past few months has been spouting racist far-right nonsense in the hopes of getting pardoned. Is he guilty? His own actions say that even he thinks he is.

garfield_light 1y ago
Irrelevant, his thoughts in the matter or him being a shithead don't make the unintended use of a smart contract illegal or not. This is just usual case of Wilhoit’s Law by shitcoin peddlers. > There must be in-groups whom the law protects but does not bind, alongside out-groups whom the law binds but does not protect. They are outside of regulatory scrutiny but god-forbid someone uses the same excuses to take their funny money.
poochkoishi728 1y ago
He can believe the tokens are rightfully his, and still believe that authorities don't see it his way. Like if you're in Salem and know you're not a witch, you'd want to take off too and chill in no-extradition treaty countries, so you don't get boiled alive by people with different outlooks. I like the analogy of an unsecured window. It doesn't seem to apply to a hypothetical (idk specifics of this company) purely private company in some crypto-friendly country that doesn't have any ties to the rule of law.

TacticalCoder 1y ago

https://www.justice.gov/usao-sdny/pr/former-security-engineer-sentenced-three-years-prison-hacking-two-decentralized https://www.justice.gov/usao-sdny/pr/former-security-enginee... From that link: "U.S. Attorney Damian Williams said: “Today, Shakeeb Ahmed was sentenced to prison in the first ever conviction for the hack of a smart contract and ordered to forfeit all of the stolen crypto. No matter how novel or sophisticated the hack, this Office and our law enforcement partners are committed to following the money and bringing hackers to justice. And as today’s sentence shows, time in prison — and forfeiture of all the stolen crypto — is the inevitable consequence of such destructive hacks.” The undisputable matter of fact is this: there have already been several cases of people who thought they could invoke the "(smart contract) code is law" argument to outsmart judges and the legal system. But that's fantasy. In practice these people, when caught, go to prison. > 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. And DeFi exchanges are "unlicensed brokers". And yet I posted a case where the hacker who "outsmarted" them is now in prison: how smart one has to be to end up in prison right? Post me a case where an "unlicensed investement firm" sued a thief who "outsmarted them" and where the judge decided to let the thief walk free. For I posted a case from justice.gov to prove my point.

programjames 1y ago

Next we're going to learn that winning Poker Bots with an "all in" strategy is defrauding the competition.

cvoss 1y ago

This is a tiresome argument. Stealing is a moral concept first, and a legal concept second. You can steal without breaking any laws, the same way you can be a bad person without breaking any laws.

PaywallBuster 1y ago

https://www.coindesk.com/policy/2024/04/18/mango-markets-exploiter-avi-eisenberg-found-guilty-of-fraud-and-manipulation https://www.coindesk.com/policy/2024/04/18/mango-markets-exp... Avi Einsenberg did the same with Mango Markets, got away with 110M and is now looking at 20 year sentence And Mango was being sued by the SEC too https://www.sec.gov/newsroom/press-releases/2024-154 https://www.sec.gov/newsroom/press-releases/2024-154 > SEC Charges Entities Operating Crypto Asset Trading Platform Mango Markets for Unregistered Offers and Sales of the Platform’s “MNGO” Governance Tokens > Pair of affiliated entities separately charged for acting as unregistered brokers

KoolKat23 1y ago

It depends if acted in accordance with the terms of the contract then it's fine but if he did something not covered by the contract it's theft. If I run an unmanned lemonade stand out front and leave a pile of money on the table, and say take your change, if you take more than what you're owed that's theft regardless of how easy it was.