CTO of Tether Paolo Ardoino recently announced on Twitter that Tether has both recovered and returned 1,000,000 USDT to a user who had mistakenly sent it to the wrong DeFi address. In fact, the user had begun thinking that the money has been lost forever.
Tether responded quickly to the user’s urge and understood it soon enough to give back the money. The situation came into light when an anonymous user who was discovered to be from a group of traders from China under the name Bill talked about losing his $1 million USDT on September 8th. The same day, the data seemed that the account had sent the money to the Swerve token contract by mistake and was unable to recover it.
“We were just a group of otc player from China, accidentally copy and paste the swerve contract address”
Tether is a centralized finance platform that is different from the functioning of decentralized finance. Decentralized apps are different in a way that the user’s crypto cannot be controlled in any way, both negative and positive. For instance, an account can be frozen if it has been undertaking illegal operations and even help the user recover assets if anything goes haywire. In the case of the user who also lost 1 million YSDT, Tether successfully recovered this huge amount as it is a part of the Centralized finance system.
Paolo Ardoino thought to quickly respond to the pleading of the trader and said it publicly that it might take a few weeks to really solve the issue.
He went on to explain earlier that there were good chances that the company would successfully recover their money as the asset was ERC20 based USDT. The issue was finally resolved and the traders received their fund back. They thanked the Tether support team for being so resolute about solving the issue. They in particular thanked Paolo Ardoino in particular for providing the major help in ensuring the funds came back to them.
Taking this as a premise, Ardoino warned the crypto users about it. He said that if they were looking at using DeFi tools they would do so at their own risk. But if something like this happens to them and they want their hard-earned money back, it will be best to ensure they use USDT. The entire set of tweets and conversation threads are given below:
Samson Mow, CSO of Blockstream initially was under the assumption that the users could have just burnt the million and provided proof to Tether which the company used to reissue the money. But Paolo Ardoino responded back saying that it was impossible to burn USDT on a particular address on the liquid Network. His entire explanation was provided explaining the mechanism in this particular case in particular tweets.
“The only solution would be required, for each transfer, an additional signature provided by a Tether watchtower. Such a system would allow Tether to “freeze” funds. But burns of tokens on specific addresses are not possible.”