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| Ronn Torossian |
Recently, a few very lucky users of Compound, the decentralized finance staking protocol platform, woke up to discover a large amount of money in their accounts.
Compound is a financial platform that acts as a bank but doesn’t have all of the traditional rules that come with banking. So, when some of its users woke up with a notification of several millions worth of cryptocurrency deposited into their accounts, the owner of the platform asked for the money to be returned. This is because, as a platform that doesn’t have the traditional bank rules, Compound wasn’t able to correct that mistake, and instead had to rely on its users to voluntarily return the money they received.
The company itself works as a blockchain-based bank and allows its users to both take out loans and borrow money with interest. Lenders, in turn, receive Compound’s native COMP token. Unfortunately, the platform received a brand-new update that contained a bug, which is how some users ended up receiving large sums of money in their accounts. That bug resulted in about $90 million to be paid out to several different users, including one that had received more than 70 million COMP tokens.
Compound founder and CEO Robert Leshner took to Twitter as soon as the mistake was discovered, and asked anyone who’d received a large amount of the incorrect payout to return it to the platform, while allowing users to keep 10 percent of the sum “as a white-hat.” Additionally, he threatened the users who wouldn’t be returning that sum, claiming that he’d reveal their identities to the Internal Revenue Service to be taxed on the income they’d received. He also suggested anyone who didn’t return the money would be doxed, which means their personal information would be shared with the public.
Leshner later apologized for that statement.
Due to the way that blockchain technology works, aside from the platform’s founder asking users to return the money, there’s no other way for Compound to recoup the lost sum. While all sums of income have to be reported to the IRS and people have to pay taxes on them, some of the statements that Leshner made didn’t make complete sense, given the situation. According to others, his threat was completely empty, as the platform doesn’t collect information on its users. Furthermore, some members of the cryptocurrency community disagreed with his request, citing one of the popular phrases, “code is law,” which implies that what the update did was fine, and should be accepted as a rule.
Plenty of the platform’s own users criticized Lesher for his statement, as well as his threats, with some stating that the company should own up to its mistakes instead.
In situations like this one, when a company makes a mistake, it’s generally best to first apologize and own up to that mistake, instead of making threats. That’s because taking things further could result in a very different PR crisis for a company, which isn’t the goal when it comes to rectifying mistakes.
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Ronn Torossian is CEO of 5WPR, a leading PR agency.
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Oct. 4, 2021, by Joe Honick
That may be ok and logical in most business circumstances; however, Trump, following his coaching from the late Roy Cohn has been able to get by in a totally different manner and get away with it. I do not at all approve of his methods, but media seem unable to deal with his approach that wins him political support. With respect, you might care to consider how political handling of such matters might call for additional thought.