Hacker News Reader

Comment by jstanley | Hacker News Reader

> his company is broke, he’s broke, and the bot is broke because he spent all the coins, after he himself ran out of money.

(emphasis mine)

How did he think this was remotely acceptable? Jesus Christ! Don't operate custodial accounts if you don't understand the consequences. You can not just spend other people's money, no matter how broke you are...

If that's your only option, give everyone their money back and declare bankruptcy.

View on HN

To put this in perspective, The Merkle estimates that Dogetipbot's creator cashed out between $140,000 and $1.4 million worth of Doge from account holders. Not exactly loose change.

[1] https://themerkle.com/whats-going-on-with-dogetipbot/

This happens with all sorts of money held in Trust. It's not unusual to see lawyers steal from trust funds, Trustees steal from trust funds, CEOs buy strippers and drugs with investor funds. We like to pretend we live in a world were people are honest and rational, and that's why people are so willing to put money into trust. But we don't live in that world, and trust should be about just that - do you trust this individual to hold that money. We pretend there is some legal regulatory system to prevent people stealing trust money but there isn't, all the legal system can do is punish people after the fact. And as evidenced by the existence and popularity of criminal courts and prisons, future punishment is often not a good deterrent for present bad behavior.

Now if it's someone like my bank I do trust them, because they have been around for a long time and have never stolen from their customers. If it's some guy on reddit with "wow such business" working with dogecoin, I think I would be a little more reluctant to trust.

In general, one also trust's one's bank (in the US at least) because it's an FDIC-insured institution; the government promises that it will use control of fiat currency to make you whole if the bank fails.

That guarantee hasn't always existed, and the Great Depression was partially exacerbated by the problem that in the event of a savings bank failure, there was no institution to make creditors whole. As far as I am aware, the BTC ecosystem has no such guarantee anywhere within it, which makes it not as safe a place for stored wealth as a US bank (assuming you trust the US economy to not implode over your lifetime, of course... Current track record suggests you should trust it more than the BTC economy ;) ).

This is cryptocurrency. Participants see being above the law as a feature.

Yes but being above morals is decidedly not a feature. I'm into cryptocurrency too.

Wait I'm being serious here: how is that not a feature? People trade humans and hit jobs on the darknet.

Do you really think "get rid of laws and people will do the right thing" is a reasonable assumption? You seem genuinely shocked at this outcome, but how many times has a story like this played out?

Myself, I relish these stories.

Most of what you've said is a complete non-sequitur, but I'll address each point in turn.

> how is that not a feature?

(Vacuously) I think it's bad to do bad things. I assume you think so too.

> People trade humans and hit jobs on the darknet.

This has nothing to do with the matter at hand. And furthermore, just because some people do something doesn't make it right. And even if those people think it's right, it doesn't mean other people think it's right.

> Do you really think "get rid of laws and people will do the right thing" is a reasonable assumption?

No. I can't see where I gave the impression that I am making this assumption.

> You seem genuinely shocked at this outcome

I am shocked. If I was operating a DogeTipBot, there is no fucking way I would just spend the users' money and then act all surprised when I ran out of money. Who the hell does that?

> how many times has a story like this played out?

Too many.

Does this really happen in darknets? Or is it just Dale Gribble types and law enforcement stings? I've seen the postings in certain places, but never assumed it was real. It seems IRC would be a more likely place for things like this to take place. It's not like a drug market.

Wait, so cryptocurrency advocates want morality without the law to back it up? Good luck with that.

Not necessarily "morality" as such, but some cryptocurrency advocates idealise the use of smart contracts and such to create binding agreements without using the threat of state violence.

Morality is just an attempt to describe the actions our monkey brains view as acceptable and unacceptable. If you remove the monkey far enough from its natural habitat, far enough that the shape and magnitude of consequences are susbtantially altered, people feel more and more free to act in ways that are immoral. Cryptocurrencies CLEARLY are having that effect. People think they are above the law and consequences, largely because they are, and act accordingly.

> You can not just spend other people's money

This is exactly how banks operate.

This is why banking regulation and licensing exists. It's also well understood that a bank will do this with your money, while a regular custodian should not.

If he'd made it clear upfront that the funds would be loaned to a risky business venture, with no reward, and people still chose to trust him with money then arguably that would be fine from a moral standpoint, but he didn't, and I'm sure he didn't because he knew nobody would have agreed to it.

> This is exactly how banks operate.

Sure, within a huge framework of regulations and insurance provided by the government.

Reply on news.ycombinator.com