Whose fault is that?

[libert19]

Chain of events:

- FTX rebranded Pax to USDP on their deposit page, but they failed to notify users for the update.

- USDP is also ticker used by Unit protocol's stable coin.

- One FTX user assumed that exchange supports the Unit Protocol's stable coin - USDP, and he deposited the same (which in reality is not supported by the exchange but is erc20 token so ends up in exchange's address).

- He contacts the FTX support, they refund the amount but with 15% fee which amounts to around $1M.

- User was disappointed with the fee taken and appeals further but gets no response. Just cause, TnC,

Code:

Wrong Address or Chain

FTX is not responsible if you send deposits or withdrawals to an incorrect address.  If you are withdrawing from FTX to an incorrect address, there is nothing FTX can do to recover the tokens.  If you deposit to an incorrect FTX address, we can attempt to recover it, but may charge a fee to do so, and if we do not generally support the deposited token or method we may be unable to recover it at all.

The chain that a crypto deposit is sent on is really important. If deposits are sent on the wrong chain we may attempt to recover it but this is in no way guaranteed. A minimum 5% fee will be charged but in many cases we will either not be able to recover the unsupported token or will require a significantly higher fee. 

Looking at above tnc it says minimum of 5%, so sounds like user is screwed but it has been updated 8 hrs ago.

The prior TnC was as follows (as taken for Rekt.News article),

Code:

FTX is not responsible if you send deposits or withdrawals to an incorrect address. If you are withdrawing from FTX to an incorrect address, there is nothing FTX can do to recover the tokens. If you deposit to an incorrect FTX address, we can attempt to recover it, but will charge up to $500 or 5% to do so.

The chain that a crypto deposit is sent on is really important. If deposits are sent on the wrong chain we will attempt to recover them but an automatic 5% fee will be charged for chains that we have systems to recover from; from other chains we might not be able to credit.

Here it says $500 or up to 5%.


Full read: https://www.rekt.news/ftx-terms-and-commissions/

Edit: This seems to be solved, either way we have lesson to learn, don't blindly deposit looking at ticker, it could go much worse with other cexes and certainly with dexes: https://mobile.twitter.com/SBF_FTX/status/1445814621097451529

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[jackg]

Chain of events:

- FTX rebranded Pax to USDP on their deposit page, but they failed to notify users for the update.

- USDP is also ticker used by Unit protocol's stable coin.

- One FTX user assumed that exchange supports the Unit Protocol's stable coin - USDP, and he deposited the same (which in reality is not supported by the exchange but is erc20 token so ends up in exchange's address).

Was there a disclaimer about the name change on the deposit screen?

I don't think ftx have much of a reason to actually charge a fee for this either if they haven't explicitly put out any form of warning to say it's their own stable coin and not someone else's.

Also I haven't heard of "unit protocol" perhaps the exchange hasn't either but it might be useful got exchanges to start linking the contract address for coins or something identifiable on the chain to give users more confidence.

Updating conditions is shady. I'm not sure how enforceable online terms and conditions are (other than ones that get you to do a task such as answer questions, rewrite the paraphrased ToS or give a checkbox for a few important conditions they'd want to enforce) but you normally also need notice before they come into effect.

[Bttzed03]

The user is at fault for not verifying everything before sending. Even though he claims that FTX did not send an update on PAX to USDP rebrand, neither did they made an announcement supporting the other USDP.

FTX is at fault for not following the existing terms at the time the incident happened.

[libert19]

~

Was there a disclaimer about the name change on the deposit screen?

No, that's why this happened.

I don't think ftx have much of a reason to actually charge a fee for this either if they haven't explicitly put out any form of warning to say it's their own stable coin and not someone else's.

True, it was mistake on their part and no it's not their own stable coin, those are two different projects with same ticker.

Also I haven't heard of "unit protocol" perhaps the exchange hasn't either but it might be useful got exchanges to start linking the contract address for coins or something identifiable on the chain to give users more confidence.

https://unit.xyz/ | https://mobile.twitter.com/unitprotocol

Updating conditions is shady. I'm not sure how enforceable online terms and conditions are (other than ones that get you to do a task such as answer questions, rewrite the paraphrased ToS or give a checkbox for a few important conditions they'd want to enforce) but you normally also need notice before they come into effect.

I just realized I'm late on this, they likely solved the user's case and then updated the tos. Sbf twitted about it.

[Darker45]

Updating conditions is shady. I'm not sure how enforceable online terms and conditions are (other than ones that get you to do a task such as answer questions, rewrite the paraphrased ToS or give a checkbox for a few important conditions they'd want to enforce) but you normally also need notice before they come into effect.

I just realized I'm late on this, they likely solved the user's case and then updated the tos. Sbf twitted about it.

So the charge of 15% was well within the ToS? It would have been a larger issue had the update on the ToS was made after the exchange was notified of the erroneous deposit but before things were resolved. That would have been really sneaky of FTX.

In any case, I don't agree that exchanges should have the liberty to update their ToS anytime and implement the new version immediately right after without asking their clients to once again review it and agree on it. I guess there are provisions in ToS which somehow give freedom to exchanges or whatever the right to update it without necessarily informing their users. Whether there is indeed this clause or not, it still is unfair.

[libert19]

So the charge of 15% was well within the ToS? It would have been a larger issue had the update on the ToS was made after the exchange was notified of the erroneous deposit but before things were resolved. That would have been really sneaky of FTX.

I dunno but guess they must have charged 5% as per previous TnC, then updated the TnC.

In any case, I don't agree that exchanges should have the liberty to update their ToS anytime and implement the new version immediately right after without asking their clients to once again review it and agree on it. I guess there are provisions in ToS which somehow give freedom to exchanges or whatever the right to update it without necessarily informing their users. Whether there is indeed this clause or not, it still is unfair.

You use it, you agree the new TnC automatically.

Code:

28. AMENDMENTS 

We may amend any portion of these Terms at any time by posting the revised version of these 
Terms with an updated revision date. The changes will become effective, and shall be deemed 
accepted by you, the first time you use the Services after the initial posting of the revised 
agreement and shall apply on a going-forward basis with respect to transactions initiated after 
the posting date. In the event that you do not agree with any such modification, your sole and 
exclusive remedy is to terminate your use of the Services and close your Account. You agree 
that we shall not be liable to you or any third party as a result of any losses suffered by any 
modification or amendment of these Terms.

[Darker45]

In any case, I don't agree that exchanges should have the liberty to update their ToS anytime and implement the new version immediately right after without asking their clients to once again review it and agree on it. I guess there are provisions in ToS which somehow give freedom to exchanges or whatever the right to update it without necessarily informing their users. Whether there is indeed this clause or not, it still is unfair.

You use it, you agree the new TnC automatically.

Code:

28. AMENDMENTS 

We may amend any portion of these Terms at any time by posting the revised version of these 
Terms with an updated revision date. The changes will become effective, and shall be deemed 
accepted by you, the first time you use the Services after the initial posting of the revised 
agreement and shall apply on a going-forward basis with respect to transactions initiated after 
the posting date. In the event that you do not agree with any such modification, your sole and 
exclusive remedy is to terminate your use of the Services and close your Account. You agree 
that we shall not be liable to you or any third party as a result of any losses suffered by any 
modification or amendment of these Terms.

Yeah, I've read countless of ToS in my life. I have always encountered stipulations such as this. I am always in disagreement with this, but what choice do I have? As a client looking for particular services, I cannot remember a single instance in which I decided not to proceed with a product simply because of a particular clause in the ToS. But it doesn't mean it's all right with me. At the very least, every time a modification is made in the ToS, all users should be promptly informed about it and the specific modifications.

Anyway, as to this particular case with FTX, it is good that everything has been resolved. I guess the user is generally thankful that the funds are returned.

[Bitcoin_Arena]

The user is at fault here for failure to differentiate the two.

Where did he get the idea that his token i being traded in FTX?

Even a mere check on coinmarketcap would show that there are 2 different tokens trading in different exchange. Non even trading on FTX at the moment.


PA Dollar USDP - https://coinmarketcap.com/currencies/paxos-standard/markets/

USDP Stablecoin - https://coinmarketcap.com/currencies/usdp/markets/

We are supposed to be responsible for our cryptocurrencies. He is even lucky they helped him. Some exchanges don't bother.