Crypto Long & Short: Cryptocurrency Markets May Be Decentralized, but They’re Still Accountable

Oops. Someone sent a $130 transaction on ethereum with a $2.6 million transaction fee. And then he or she did it again. And then another user made a transaction with a $500,000 fee. TAKEAWAY: This is an extraordinary story for many reasons. One is the mystery: who is sending transactions with such whopping fees, and why? Some think it could be money laundering, others suggest blackmail, or it could just be a series of genuine mistakes. Another compelling aspect is what this says about the vulnerabilities of trustless transactions – if this were traditional finance, the financial middleman would notice and hopefully fix the error. In crypto, however, what’s done is done. The miners who receive the outsized fees can decide to return the funds, but they don’t have to, and they may not even be able to trace the sender. This highlights how removing the need to trust the middleman merely surfaces vulnerabilities elsewhere.