Cryptocurrencies

The bug that costs BlockFi a lot

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If promotional campaigns allow exchanges to retain their customers and attract others, the one recently conducted by BolckFi could have the opposite effect. While initially supposed to give them small bonuses, the platform mistakenly deposited large amounts of bitcoin into the accounts of some users. After unsuccessfully trying to reverse the transactions involved, the exchange reportedly threatened to sue customers for withdrawing excessive amounts. The two parties now risk engaging in a standoff that could cost BlockFi the departure of a few users.


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Almost 100 customers wrongly credited with over 700 BTC

To justify his mistake, BlockFi evokes a promotional campaign started last March whose transaction orders were upset. ” On May 17, 2021, less than 100 customers were wrongly credited with cryptocurrencies associated with a promotional payment that were not theirs “, said BolckFi in a post on Reddit. Originally, eligible participants were to receive a bonus in GUSD in the form of a one-time payment. Instead of the stablecoin launched by the exchange Gemini, some participants had their accounts credited with more than 700 BTC.


Despite the fall in asset prices, it represented at least more than $ 25 million at the material time. BlockFi then specified that the funds initially held by its customers were not impacted and that they are safeguarded. The same would apply to other operations of the exchange which said that steps were taken to ensure that an error of this type does not occur again. However, some BlockFi customers have claimed to have been threatened with legal action by the exchange if they did not retrocede the BTC they accidentally received.

BlockFi would have trouble identifying withdrawals unrelated to his error

Also speaking on Reddit, one of the customers concerned recounted his mishap with BlockFi whose conduct he disapproves of. Two days after the accidental credit, he withdrew USDCs he had deposited a month earlier on an occasion unrelated to promoting the exchange.

“BlockFi made these deposits of BTC and GUSD into people’s accounts when they shouldn’t have been. They have reversed the BTC deposit and not the GUSD in mine at the moment. I didn’t touch it anyway. Now they send me an email accusing me of withdrawing funds that are not mine saying it is a fraud and a crime that they will act on if they do not return in both next hours He said on Reddit.

With the bitcoin debacle in the market, it’s understandable that BlockFi want to limit its losses as much as possible in these difficult times for the entire industry. In other circumstances, the exchange was able to prove its generosity, notably with the record payment of $ 20 million in interest in Bitcoin and Ether to its investors at the start of the year.

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DISCLAIM

The comments and opinions expressed in this article are those of the author alone, and should not be considered as investment advice. Do your own research before making any investment decisions.

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