StableGains lost $42M in Anchor Protocol.
StableGains lost millions of dollars in customer funds in Anchor Protocol without telling its users. The Anchor Protocol offered depositors 19-20% APY before its parent ecosystem, Terra LUNA, lost tens of billions of dollars in market capitalization as LUNA fell below $0.01 and its stablecoin (UST) collapsed.
A Terra Research Forum member raised the alarm. StableGains changed its homepage and Terms and Conditions to reflect how it mitigates risk, a tacit admission that it should have done so from the start.
StableGains raised $600,000 in YCombinator's W22 batch. Moonfire, Broom Ventures, and Goodwater Capital invested $3 million more.
StableGains' 15% yield product attracted $42 million in deposits. StableGains kept most of its deposits in Anchor's UST pool earning 19-20% APY, kept one-quarter of the interest as a management fee, and then gave customers their promised 15% APY. It lost almost all customer funds when UST melted down. It changed withdrawal times, hurting customers.
- StableGains said de-pegging was unlikely. According to its website, 1 UST can be bought and sold for $1 of LUNA. LUNA became worthless, and Terra shut down its blockchain.
- It promised to diversify assets across several stablecoins to reduce the risk of one losing its $1 peg, but instead kept almost all of them in one basket.
- StableGains promised withdrawals in three business days, even if a stablecoin needed time to regain its peg. StableGains uses Coinbase for deposits and withdrawals, and customers receive the exact amount of USDC requested.
StableGains scrubs its website squeaky clean
StableGains later edited its website to say it only uses the "most trusted and tested stablecoins" and extended withdrawal times from three days to indefinite time "in extreme cases."
Previously, USDC, TerraUST (UST), and Dai were used (DAI). StableGains changed UST-related website content after the meltdown. It also removed most references to DAI.
Customers noticed a new clause in the Terms and Conditions denying StableGains liability for withdrawal losses. This new clause would have required customers to agree not to sue before withdrawing funds, avoiding a class-action lawsuit.
Customers must sign a waiver to receive a refund.
Erickson Kramer & Osborne law firm has asked StableGains to preserve all internal documents on customer accounts, marketing, and TerraUSD communications. The firm has not yet filed a lawsuit.
Thousands of StableGains customers lost an estimated $42 million.
Celsius Network customers also affected
CEL used Terra LUNA's Anchor Protocol. Celsius users lost money in the crypto market crash and UST meltdown. Many held CEL and LUNA as yielding deposits.
CEO Alex Mashinsky accused "unknown malefactors" of targeting Celsius Network without evidence. Celsius has not publicly investigated this claim as of this article's publication.
CEL fell before UST de-pegged. On June 2, 2021, it reached $8.01. May 19's close: $0.82.
When some Celsius Network users threatened to leave over token losses, Mashinsky replied, "Leave if you don't think I'm sincere and working harder than you, seven days a week."
Celsius Network withdrew $500 million from Anchor Protocol, but smaller holders had trouble.
Read original article here
More on Web3 & Crypto

Ryan Weeks
3 years ago
Terra fiasco raises TRON's stablecoin backstop
After Terra's algorithmic stablecoin collapsed in May, TRON announced a plan to increase the capital backing its own stablecoin.
USDD, a near-carbon copy of Terra's UST, arrived on the TRON blockchain on May 5. TRON founder Justin Sun says USDD will be overcollateralized after initially being pegged algorithmically to the US dollar.
A reserve of cryptocurrencies and stablecoins will be kept at 130 percent of total USDD issuance, he said. TRON described the collateral ratio as "guaranteed" and said it would begin publishing real-time updates on June 5.
Currently, the reserve contains 14,040 bitcoin (around $418 million), 140 million USDT, 1.9 billion TRX, and 8.29 billion TRX in a burning contract.
Sun: "We want to hybridize USDD." We have an algorithmic stablecoin and TRON DAO Reserve.
algorithmic failure
USDD was designed to incentivize arbitrageurs to keep its price pegged to the US dollar by trading TRX, TRON's token, and USDD. Like Terra, TRON signaled its intent to establish a bitcoin and cryptocurrency reserve to support USDD in extreme market conditions.
Still, Terra's UST failed despite these safeguards. The stablecoin veered sharply away from its dollar peg in mid-May, bringing down Terra's LUNA and wiping out $40 billion in value in days. In a frantic attempt to restore the peg, billions of dollars in bitcoin were sold and unprecedented volumes of LUNA were issued.
Sun believes USDD, which has a total circulating supply of $667 million, can be backed up.
"Our reserve backing is diversified." Bitcoin and stablecoins are included. USDC will be a small part of Circle's reserve, he said.
TRON's news release lists the reserve's assets as bitcoin, TRX, USDC, USDT, TUSD, and USDJ.
All Bitcoin addresses will be signed so everyone knows they belong to us, Sun said.
Not giving in
Sun told that the crypto industry needs "decentralized" stablecoins that regulators can't touch.
Sun said the Luna Foundation Guard, a Singapore-based non-profit that raised billions in cryptocurrency to buttress UST, mismanaged the situation by trying to sell to panicked investors.
He said, "We must be ahead of the market." We want to stabilize the market and reduce volatility.
Currently, TRON finances most of its reserve directly, but Sun says the company hopes to add external capital soon.
Before its demise, UST holders could park the stablecoin in Terra's lending platform Anchor Protocol to earn 20% interest, which many deemed unsustainable. TRON's JustLend is similar. Sun hopes to raise annual interest rates from 17.67% to "around 30%."
This post is a summary. Read full article here

Trent Lapinski
4 years ago
What The Hell Is A Crypto Punk?
We are Crypto Punks, and we are changing your world.
A “Crypto Punk” is a new generation of entrepreneurs who value individual liberty and collective value creation and co-creation through decentralization. While many Crypto Punks were born and raised in a digital world, some of the early pioneers in the crypto space are from the Oregon Trail generation. They were born to an analog world, but grew up simultaneously alongside the birth of home computing, the Internet, and mobile computing.
A Crypto Punk’s world view is not the same as previous generations. By the time most Crypto Punks were born everything from fiat currency, the stock market, pharmaceuticals, the Internet, to advanced operating systems and microprocessing were already present or emerging. Crypto Punks were born into pre-existing conditions and systems of control, not governed by logic or reason but by greed, corporatism, subversion, bureaucracy, censorship, and inefficiency.
All Systems Are Human Made
Crypto Punks understand that all systems were created by people and that previous generations did not have access to information technologies that we have today. This is why Crypto Punks have different values than their parents, and value liberty, decentralization, equality, social justice, and freedom over wealth, money, and power. They understand that the only path forward is to work together to build new and better systems that make the old world order obsolete.
Unlike the original cypher punks and cyber punks, Crypto Punks are a new iteration or evolution of these previous cultures influenced by cryptography, blockchain technology, crypto economics, libertarianism, holographics, democratic socialism, and artificial intelligence. They are tasked with not only undoing the mistakes of previous generations, but also innovating and creating new ways of solving complex problems with advanced technology and solutions.
Where Crypto Punks truly differ is in their understanding that computer systems can exist for more than just engagement and entertainment, but actually improve the human condition by automating bureaucracy and inefficiency by creating more efficient economic incentives and systems.
Crypto Punks Value Transparency and Do Not Trust Flawed, Unequal, and Corrupt Systems
Crypto Punks have a strong distrust for inherently flawed and corrupt systems. This why Crypto Punks value transparency, free speech, privacy, and decentralization. As well as arguably computer systems over human powered systems.
Crypto Punks are the children of the Great Recession, and will never forget the economic corruption that still enslaves younger generations.
Crypto Punks were born to think different, and raised by computers to view reality through an LED looking glass. They will not surrender to the flawed systems of economic wage slavery, inequality, censorship, and subjection. They will literally engineer their own unstoppable financial systems and trade in cryptography over fiat currency merely to prove that belief systems are more powerful than corruption.
Crypto Punks are here to help achieve freedom from world governments, corporations and bankers who monetizine our data to control our lives.
Crypto Punks Decentralize
Despite all the evils of the world today, Crypto Punks know they have the power to create change. This is why Crypto Punks are optimistic about the future despite all the indicators that humanity is destined for failure.
Crypto Punks believe in systems that prioritize people and the planet above profit. Even so, Crypto Punks still believe in capitalistic systems, but only capitalistic systems that incentivize good behaviors that do not violate the common good for the sake of profit.
Cyber Punks Are Co-Creators
We are Crypto Punks, and we will build a better world for all of us. For the true price of creation is not in US dollars, but through working together as equals to replace the unequal and corrupt greedy systems of previous generations.
Where they have failed, Crypto Punks will succeed. Not because we want to, but because we have to. The world we were born into is so corrupt and its systems so flawed and unequal we were never given a choice.
We have to be the change we seek.
We are Crypto Punks.
Either help us, or get out of our way.
Are you a Crypto Punk?

mbvissers.eth
3 years ago
Why does every smart contract seem to implement ERC165?
ERC165 (or EIP-165) is a standard utilized by various open-source smart contracts like Open Zeppelin or Aavegotchi.
What's it? You must implement? Why do we need it? I'll describe the standard and answer any queries.
What is ERC165
ERC165 detects and publishes smart contract interfaces. Meaning? It standardizes how interfaces are recognized, how to detect if they implement ERC165, and how a contract publishes the interfaces it implements. How does it work?
Why use ERC165? Sometimes it's useful to know which interfaces a contract implements, and which version.
Identifying interfaces
An interface function's selector. This verifies an ABI function. XORing all function selectors defines an interface in this standard. The following code demonstrates.
// SPDX-License-Identifier: UNLICENCED
pragma solidity >=0.8.0 <0.9.0;
interface Solidity101 {
function hello() external pure;
function world(int) external pure;
}
contract Selector {
function calculateSelector() public pure returns (bytes4) {
Solidity101 i;
return i.hello.selector ^ i.world.selector;
// Returns 0xc6be8b58
}
function getHelloSelector() public pure returns (bytes4) {
Solidity101 i;
return i.hello.selector;
// Returns 0x19ff1d21
}
function getWorldSelector() public pure returns (bytes4) {
Solidity101 i;
return i.world.selector;
// Returns 0xdf419679
}
}This code isn't necessary to understand function selectors and how an interface's selector can be determined from the functions it implements.
Run that sample in Remix to see how interface function modifications affect contract function output.
Contracts publish their implemented interfaces.
We can identify interfaces. Now we must disclose the interfaces we're implementing. First, import IERC165 like so.
pragma solidity ^0.4.20;
interface ERC165 {
/// @notice Query if a contract implements an interface
/// @param interfaceID The interface identifier, as specified in ERC-165
/// @dev Interface identification is specified in ERC-165.
/// @return `true` if the contract implements `interfaceID` and
/// `interfaceID` is not 0xffffffff, `false` otherwise
function supportsInterface(bytes4 interfaceID) external view returns (bool);
}We still need to build this interface in our smart contract. ERC721 from OpenZeppelin is a good example.
// SPDX-License-Identifier: MIT
// OpenZeppelin Contracts (last updated v4.5.0) (token/ERC721/ERC721.sol)
pragma solidity ^0.8.0;
import "./IERC721.sol";
import "./extensions/IERC721Metadata.sol";
import "../../utils/introspection/ERC165.sol";
// ...
contract ERC721 is Context, ERC165, IERC721, IERC721Metadata {
// ...
function supportsInterface(bytes4 interfaceId) public view virtual override(ERC165, IERC165) returns (bool) {
return
interfaceId == type(IERC721).interfaceId ||
interfaceId == type(IERC721Metadata).interfaceId ||
super.supportsInterface(interfaceId);
}
// ...
}I deleted unnecessary code. The smart contract imports ERC165, IERC721 and IERC721Metadata. The is keyword at smart contract declaration implements all three.
Kind (interface).
Note that type(interface).interfaceId returns the same as the interface selector.
We override supportsInterface in the smart contract to return a boolean that checks if interfaceId is the same as one of the implemented contracts.
Super.supportsInterface() calls ERC165 code. Checks if interfaceId is IERC165.
function supportsInterface(bytes4 interfaceId) public view virtual override returns (bool) {
return interfaceId == type(IERC165).interfaceId;
}So, if we run supportsInterface with an interfaceId, our contract function returns true if it's implemented and false otherwise. True for IERC721, IERC721Metadata, andIERC165.
Conclusion
I hope this post has helped you understand and use ERC165 and why it's employed.
Have a great day, thanks for reading!
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Alex Mathers
3 years ago
400 articles later, nobody bothered to read them.
Writing for readers:
14 years of daily writing.
I post practically everything on social media. I authored hundreds of articles, thousands of tweets, and numerous volumes to almost no one.
Tens of thousands of readers regularly praise me.
I despised writing. I'm stuck now.
I've learned what readers like and what doesn't.
Here are some essential guidelines for writing with impact:
Readers won't understand your work if you can't.
Though obvious, this slipped me up. Share your truths.
Stories engage human brains.
Showing the journey of a person from worm to butterfly inspires the human spirit.
Overthinking hinders powerful writing.
The best ideas come from inner understanding in between thoughts.
Avoid writing to find it. Write.
Writing a masterpiece isn't motivating.
Write for five minutes to simplify. Step-by-step, entertaining, easy steps.
Good writing requires a willingness to make mistakes.
So write loads of garbage that you can edit into a good piece.
Courageous writing.
A courageous story will move readers. Personal experience is best.
Go where few dare.
Templates, outlines, and boundaries help.
Limitations enhance writing.
Excellent writing is straightforward and readable, removing all the unnecessary fat.
Use five words instead of nine.
Use ordinary words instead of uncommon ones.
Readers desire relatability.
Too much perfection will turn it off.
Write to solve an issue if you can't think of anything to write.
Instead, read to inspire. Best authors read.
Every tweet, thread, and novel must have a central idea.
What's its point?
This can make writing confusing.
️ Don't direct your reader.
Readers quit reading. Demonstrate, describe, and relate.
Even if no one responds, have fun. If you hate writing it, the reader will too.

Protos
3 years ago
Plagiarism on OpenSea: humans and computers
OpenSea, a non-fungible token (NFT) marketplace, is fighting plagiarism. A new “two-pronged” approach will aim to root out and remove copies of authentic NFTs and changes to its blue tick verified badge system will seek to enhance customer confidence.
According to a blog post, the anti-plagiarism system will use algorithmic detection of “copymints” with human reviewers to keep it in check.
Last year, NFT collectors were duped into buying flipped images of the popular BAYC collection, according to The Verge. The largest NFT marketplace had to remove its delay pay minting service due to an influx of copymints.
80% of NFTs removed by the platform were minted using its lazy minting service, which kept the digital asset off-chain until the first purchase.
NFTs copied from popular collections are opportunistic money-grabs. Right-click, save, and mint the jacked JPEGs that are then flogged as an authentic NFT.
The anti-plagiarism system will scour OpenSea's collections for flipped and rotated images, as well as other undescribed permutations. The lack of detail here may be a deterrent to scammers, or it may reflect the new system's current rudimentary nature.
Thus, human detectors will be needed to verify images flagged by the detection system and help train it to work independently.
“Our long-term goal with this system is two-fold: first, to eliminate all existing copymints on OpenSea, and second, to help prevent new copymints from appearing,” it said.
“We've already started delisting identified copymint collections, and we'll continue to do so over the coming weeks.”
It works for Twitter, why not OpenSea
OpenSea is also changing account verification. Early adopters will be invited to apply for verification if their NFT stack is worth $100 or more. OpenSea plans to give the blue checkmark to people who are active on Twitter and Discord.
This is just the beginning. We are committed to a future where authentic creators can be verified, keeping scammers out.
Also, collections with a lot of hype and sales will get a blue checkmark. For example, a new NFT collection sold by the verified BAYC account will have a blue badge to verify its legitimacy.
New requests will be responded to within seven days, according to OpenSea.
These programs and products help protect creators and collectors while ensuring our community can confidently navigate the world of NFTs.
By elevating authentic content and removing plagiarism, these changes improve trust in the NFT ecosystem, according to OpenSea.
OpenSea is indeed catching up with the digital art economy. Last August, DevianArt upgraded its AI image recognition system to find stolen tokenized art on marketplaces like OpenSea.
It scans all uploaded art and compares it to “public blockchain events” like Ethereum NFTs to detect stolen art.

Waleed Rikab, PhD
3 years ago
The Enablement of Fraud and Misinformation by Generative AI What You Should Understand
Recent investigations have shown that generative AI can boost hackers and misinformation spreaders.
Since its inception in late November 2022, OpenAI's ChatGPT has entertained and assisted many online users in writing, coding, task automation, and linguistic translation. Given this versatility, it is maybe unsurprising but nonetheless regrettable that fraudsters and mis-, dis-, and malinformation (MDM) spreaders are also considering ChatGPT and related AI models to streamline and improve their operations.
Malign actors may benefit from ChatGPT, according to a WithSecure research. ChatGPT promises to elevate unlawful operations across many attack channels. ChatGPT can automate spear phishing attacks that deceive corporate victims into reading emails from trusted parties. Malware, extortion, and illicit fund transfers can result from such access.
ChatGPT's ability to simulate a desired writing style makes spear phishing emails look more genuine, especially for international actors who don't speak English (or other languages like Spanish and French).
This technique could let Russian, North Korean, and Iranian state-backed hackers conduct more convincing social engineering and election intervention in the US. ChatGPT can also create several campaigns and various phony online personas to promote them, making such attacks successful through volume or variation. Additionally, image-generating AI algorithms and other developing techniques can help these efforts deceive potential victims.
Hackers are discussing using ChatGPT to install malware and steal data, according to a Check Point research. Though ChatGPT's scripts are well-known in the cyber security business, they can assist amateur actors with little technical understanding into the field and possibly develop their hacking and social engineering skills through repeated use.
Additionally, ChatGPT's hacking suggestions may change. As a writer recently indicated, ChatGPT's ability to blend textual and code-based writing might be a game-changer, allowing the injection of innocent content that would subsequently turn out to be a malicious script into targeted systems. These new AI-powered writing- and code-generation abilities allow for unique cyber attacks, regardless of viability.
OpenAI fears ChatGPT usage. OpenAI, Georgetown University's Center for Security and Emerging Technology, and Stanford's Internet Observatory wrote a paper on how AI language models could enhance nation state-backed influence operations. As a last resort, the authors consider polluting the internet with radioactive or misleading data to ensure that AI language models produce outputs that other language models can identify as AI-generated. However, the authors of this paper seem unaware that their "solution" might cause much worse MDM difficulties.
Literally False News
The public argument about ChatGPTs content-generation has focused on originality, bias, and academic honesty, but broader global issues are at stake. ChatGPT can influence public opinion, troll individuals, and interfere in local and national elections by creating and automating enormous amounts of social media material for specified audiences.
ChatGPT's capacity to generate textual and code output is crucial. ChatGPT can write Python scripts for social media bots and give diverse content for repeated posts. The tool's sophistication makes it irrelevant to one's language skills, especially English, when writing MDM propaganda.
I ordered ChatGPT to write a news piece in the style of big US publications declaring that Ukraine is on the verge of defeat in its fight against Russia due to corruption, desertion, and exhaustion in its army. I also gave it a fake reporter's byline and an unidentified NATO source's remark. The outcome appears convincing:
Worse, terrible performers can modify this piece to make it more credible. They can edit the general's name or add facts about current wars. Furthermore, such actors can create many versions of this report in different forms and distribute them separately, boosting its impact.
In this example, ChatGPT produced a news story regarding (fictional) greater moviegoer fatality rates:
Editing this example makes it more plausible. Dr. Jane Smith, the putative author of the medical report, might be replaced with a real-life medical person or a real victim of this supposed medical hazard.
Can deceptive texts be found? Detecting AI text is behind AI advancements. Minor AI-generated text alterations can upset these technologies.
Some OpenAI individuals have proposed covert methods to watermark AI-generated literature to prevent its abuse. AI models would create information that appears normal to humans but would follow a cryptographic formula that would warn other machines that it was AI-made. However, security experts are cautious since manually altering the content interrupts machine and human detection of AI-generated material.
How to Prepare
Cyber security and IT workers can research and use generative AI models to fight spear fishing and extortion. Governments may also launch MDM-defence projects.
In election cycles and global crises, regular people may be the most vulnerable to AI-produced deceit. Until regulation or subsequent technical advances, individuals must recognize exposure to AI-generated fraud, dating scams, other MDM activities.
A three-step verification method of new material in suspicious emails or social media posts can help identify AI content and manipulation. This three-step approach asks about the information's distribution platform (is it reliable? ), author (is the reader familiar with them? ), and plausibility given one's prior knowledge of the topic.
Consider a report by a trusted journalist that makes shocking statements in their typical manner. AI-powered fake news may be released on an unexpected platform, such as a newly created Facebook profile. However, if it links to a known media source, it is more likely to be real.
Though hard and subjective, this verification method may be the only barrier against manipulation for now.
AI language models:
How to Recognize an AI-Generated Article ChatGPT, the popular AI-powered chatbot, can and likely does generate medium.com-style articles.
AI-Generated Text Detectors Fail. Do This. Online tools claim to detect ChatGPT output. Even with superior programming, I tested some of these tools. pub
Why Original Writers Matter Despite AI Language Models Creative writers may never be threatened by AI language models.