In her latest outing regarding the hack she suffered, Kucoin claimed to have recovered 84% of stolen assets. This news appears to be a victory, but which does not mean to delight all the customers of the exchange. Part of them, namely the crypto projects, regret what they call Kucoin’s liability leak. The exchange that kept a good portion of their assets for them forced them to produce trading tokens to cover losses.
Back to the wall, 60% of projects follow Kucoin’s recommendation
Unable to recover all of the tokens stolen during the hack, Kucoin thus recommended to the various projects of modify their smart contracts and replace the affected tokens. The radical solution to say the least, although effective, is much more suited to the exchange, which thus covers its rear. In the face of pressure, 60% of the projects concerned ended up giving up and launching the trading tokens. A solution which, however, is not considered by others who see it as the establishment of ’a fork that would sow confusion in their ecosystem with the existence of two tokens. This is precisely the case with DIA whose co-founder Paul Claudius did not hide his displeasure.
“We have consciously built our smart contract in a way that is truly decentralized and we, as a team, cannot just stop transactions, blacklisted, whitelisted, etc.. As a team, we obviously trust ourselves, but we don’t think the world should trust us. And that’s the reason why we build our smart contracts this way. I can understand that projects where, say, 50% of the tokens have been affected by hacking, choose the option of shutting down their system. They were back to the wall.” did he declare.
Liability leak from Kucoin
By refusing the alternative of trading tokens, projects expose themselves to misunderstanding within their communities. So what should be the responsibility of Kucoin ultimately becomes a dilemma to be managed by projects themselves. As if to protect itself, the exchange recalled that a hard fork had in the past allowed bitcoin and Ethereum to face equally critical situations. A daring parallel that did not fail to appeal Richard Sanders, the founder of the blockchain analytics company CipherBlade.
The latter sees clearly a hypocritical attitude and avoidance of responsibility from the exchange. ” Setting a precedent whenever an exchange is hacked or someone is negligent for centralized action goes against the very foundation of what this decentralized technology is meant to be. Everything KuCoin does really boils down to trying to save face. ” did he declare.
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While it is true that exceptional situations require similar decisions, the one advocated by Kucoin in this case has a bitter taste for projects. Regrettably, whether they apply this strategy or not, the resulting consequences will only be borne by the community of tokens concerned.