THERE IS NO LAND DROP. DO NOT CONNECT YOUR WALLET
January 14, 2022 6:31 AM   Subscribe

People Building ‘Blockchain City’ in Wyoming Scammed by Hackers.

"The ease with which funds were stolen and a community duped—most of the ETH transfers happened in the space of one hour—suggests that building a city on the blockchain might not be the wisest endeavor if you’re also using a gaming chat application to do everything. "
posted by signal (129 comments total) 21 users marked this as a favorite
 
This is so sad. Utopian Capitalism. I want to make a joke about tear drops, but it feels inappropriate.
posted by eustatic at 6:39 AM on January 14 [1 favorite]


In the last 3 days, the hacker has transferred 20 ETH to the Tornado.Cash tumbler to hide where the funds eventually landed, and 11.6 ETH to another address. 14 ETH remain in the wallet. It's unclear if all of the funds are from CityDAO investors, and the address has been marked as a scam in the Etherscan explorer.

This isn’t the first webhook attack used to steal ETH from Discord communities. In October, a 17 year old was able to steal 88 ETH from the Discord channels of an NFT project named CreatureToadz, but returned it to avoid being publicly doxxed.
I think the ongoing crypto buzz is just tulip trading, but man do those two paras tickle some neurons first formed reading Gibson and Stephenson back in the day.
posted by Heywood Mogroot III at 6:50 AM on January 14 [48 favorites]


DUNNING KRUGERANDS
posted by lalochezia at 6:57 AM on January 14 [115 favorites]


I think the ongoing crypto buzz is just tulip trading, but man do those two paras tickle some neurons first formed reading Gibson and Stephenson back in the day.

I totally get what you're saying, but at the same time, I don't recall either of those fine gentlemen writing about something as asinine as this NFT horseshit.
posted by AlonzoMosleyFBI at 6:57 AM on January 14 [17 favorites]


Lyons800 [...] got on a voice call with the scammer, who convinced the moderator to let them inspect their console. From there, the scammer obtained Lyons800's Discord authentication token that let them hijack the account. In a tweet, Lyons800 described this as "a ridiculous security breach from Discord."

There is no polite way of putting this: these people are morons.
posted by ook at 7:00 AM on January 14 [57 favorites]


This is actually good for Bitcoin.

See, the real problem in this hack is that Discord wasn't secure enough. We need a version of Discord on the blockchain. Every post signed and dated. Sure it'll take an hour or so for posts to show up, and the global Discord community could only post seven messages a second (assuming Bitcoin isn't doing anything else at the moment). But it'd be stored immutably in a distributed ledger! It's a shame each post would emit as much CO2 as driving 2700 miles but this is the future of Web3 we're talking about.

On second thought perhaps Ethereum would be the better choice. That'd get you up to 30 messages a second (again, for the whole world of Discord3 conversations). Each message would cost $20+ in gas fees but then again that has some advantages.
posted by Nelson at 7:01 AM on January 14 [51 favorites]


Crypto bro got no row to hoe.
posted by aeshnid at 7:02 AM on January 14 [15 favorites]


(In case it's not clear to nontechnical people, the 'security breach' described in that quote is the scammer saying "hey I want you to prove that's your house, I need to look at your housekey for a minute" and the cryptobro responding "sure! Here you go!" and then blaming Schlage for the resulting robbery.)
posted by ook at 7:04 AM on January 14 [80 favorites]


At this point, I've come to see "blockchain" as synonymous with "hype" and "sucker". It's a keyword in my mental filter that sends anything related straight to the trash.
posted by ryanshepard at 7:07 AM on January 14 [33 favorites]


I want to lol so hard over a wet ware attack succeeding against this sort of group but the existence of a security token that once known side steps all authentication does seem like a serious weakness of the system. What sort of functions is this feature supposed to enable?
posted by Mitheral at 7:08 AM on January 14 [1 favorite]


To put a sharper point on how ridiculous that complaint about Discord is, if you open up the console, you see enormous colorful text reading:

Hold Up!
If someone told you to copy/paste something here you have an 11/10 chance you're being scammed.
Pasting anything in here could give attackers access to your Discord account.
Unless you understand exactly what you are doing, close this window and stay safe.
posted by wesleyac at 7:09 AM on January 14 [49 favorites]


Wyoming: lowest vaccination rate, highest percent vote for Trump. Just saying the dudes (or dudettes) know where to hold a scam.
posted by dances_with_sneetches at 7:16 AM on January 14 [18 favorites]


the existence of a security token that once known side steps all authentication

That's how the authentication works -- the browser needs to be able to identify itself to the server; that token is the end result of the authentication process, and it's kept private unless you do something idiotic like give the attacker direct console access to look it up. It's not a permanent token, in some setups it will get regenerated on every request, but the attacker only needs to use it once.
posted by ook at 7:17 AM on January 14 [6 favorites]


Yet more proof that building a city on rock and roll remains the most viable option.
posted by clawsoon at 7:19 AM on January 14 [94 favorites]


(In case it's not clear to nontechnical people, the 'security breach' described in that quote is the scammer saying "hey I want you to prove that's your house, I need to look at your housekey for a minute" and the cryptobro responding "sure! Here you go!" and then blaming Schlage for the resulting robbery.)

It's even stupider than this. It's like someone posted a photoshopped a picture of you in your own home committing a crime, and then you proceeded to call that person and let them look at your housekey to prove it wasn't you.
posted by thecjm at 7:23 AM on January 14 [7 favorites]


I've been browsing r/Buttcoin a bit recently, and it seems like there's a dizzying hurricane of scams right now connected to various blockchain technologies. This feels like it could've been one of those kliuless FPPs with dozens of links to examples of the underlying problem, though I'm kind of happy that the FPP we got is only one example of the shit flying around rather than the whole overwhelming shit hurricane.
posted by clawsoon at 7:30 AM on January 14 [3 favorites]


building a city on rock and roll remains the most viable option

At least they'd have Marconi playing the mamba, if everything else didn't work
posted by scruss at 7:44 AM on January 14 [13 favorites]


These people want to build a town? How are they going to manage something like a sewage system? Or zoning regulations?
posted by TheWhiteSkull at 7:50 AM on January 14 [7 favorites]


DUNNING KRUGERANDS
posted by lalochezia at 8:57 AM on January 14


I regret that I have but one favorite to award this...crystalline, pure, genius.
posted by jquinby at 7:51 AM on January 14 [5 favorites]


Welcome to Dunning KrugerLand, please leave your non funginable tokens at the door.
posted by Lanark at 7:51 AM on January 14 [9 favorites]


This is my surprised bored ape face.
posted by hangashore at 7:56 AM on January 14 [14 favorites]


TheWhiteSkull: "How are they going to manage something like a sewage system? Or zoning regulations?"

1. Pay-per-flush with BTC. Of course, the whole town only gets 7 flushes per second. I'm sure that won't be a problem during the Superb Owl.
2. Zoning is for freedom-hating coastal elites.
posted by adamrice at 7:57 AM on January 14 [4 favorites]


This is so sad.

Also, fucking hilarious.
posted by acb at 7:57 AM on January 14 [7 favorites]


I mean, they probably have some sort of theoretical financing model in place for funding sewage or a power grid, but you still have to hire someone to design it, and contractors and such.

If these people are getting scammed now, wait until they have to deal with the actual mob.
posted by TheWhiteSkull at 8:09 AM on January 14 [9 favorites]


Pay-per-flush with BTC. Of course, the whole town only gets 7 flushes per second. I'm sure that won't be a problem during the Superb Owl.

If you store your wallet on my platform, I'll float you any surge in flushes and then automatically push them out to the blockchain as the network allows.
posted by RonButNotStupid at 8:12 AM on January 14 [2 favorites]


My favorite fact is that this bitopia is currently only 40 acres...in Wyoming! Out there that's probably considered a modest parcel for one person.
posted by anhedonic at 8:21 AM on January 14 [13 favorites]


Because I am a curious person I checked out the CreatureToadz link in the article and my god, is it possible to hate NFT “art” more? I mean, I just don’t get it and the staggering amount of money these jokes are generating is staggering.
posted by misterpatrick at 8:24 AM on January 14 [4 favorites]


I’ve seen a huge number of security schemes come and go over the years and every last one of them has had the same single point of failure.

Suggested solutions:

1) Your crypto software enforces a 1 hour cool-down period between requesting your certs and their delivery
2) Two different accounts are required to access the main certs
3) Certs are tied to a particular piece of hardware

Obviously users will find a way around these, but at least they’re a start on addressing the root of the problem.
posted by Tell Me No Lies at 8:26 AM on January 14


is it possible to hate NFT “art” more? I mean, I just don’t get it and the staggering amount of money these jokes are generating is staggering.

It becomes more plausible when you think of them as barely plausible cover stories for pyramid schemes.
posted by clawsoon at 8:28 AM on January 14 [9 favorites]


How are they going to manage something like a sewage system?

That’s a very good point. All of those NFTs going to waste…
posted by Tell Me No Lies at 8:29 AM on January 14 [3 favorites]


The barely plausible cover story effect is also why it's a safe bet that the whole cryptocurrency field will vehemently resist any security precautions. You could mint NFTs for it!
posted by Drastic at 8:29 AM on January 14 [2 favorites]


the staggering amount of money these jokes are generating is staggering.

Much of the money is wash trading; i.e., the sellers buying it from themselves for inflated prices to build up a price history, so as to pass it off to a mark at what appears to be a generous discount.
posted by acb at 8:32 AM on January 14 [12 favorites]


Ethereum is a Dark Forest.
"The Dark Forest is my favorite science fiction book. It introduces the concept of a “dark forest” — an environment in which detection means certain death at the hands of advanced predators. In this environment, publicly identifying someone else’s location is as good as directly destroying them."
posted by JoeZydeco at 8:46 AM on January 14 [11 favorites]


This seems like the inevitable result of trying to build a "community" on the notion that nothing and nobody can be trusted.
posted by klanawa at 8:47 AM on January 14 [20 favorites]


the staggering amount of money these jokes are generating is staggering.

Much of the money is wash trading; i.e., the sellers buying it from themselves for inflated prices to build up a price history, so as to pass it off to a mark at what appears to be a generous discount.


As I understand it from Twitter/Discord chatter, many NFT sales are actually worse for the sellers than wash trades, because they take place at a loss and involve a real second participant.

A true wash trade would be like Redd from Animal Crossing is selling terrible artwork for 400,000 Bells to himself to create an impression of value. The thing the NFTs do is like Redd giving Timmy a collection of insects that's worth 420,000 Bells, and then having Timmy "buy" the bad artwork for 400,000 Bells.
posted by All Might Be Well at 8:47 AM on January 14 [3 favorites]


Much of the money is wash trading; i.e., the sellers buying it from themselves for inflated prices to build up a price history, so as to pass it off to a mark at what appears to be a generous discount.

"This IS a Piece of Paper!"
posted by AlonzoMosleyFBI at 8:48 AM on January 14 [4 favorites]


The stunning thing about failures like this is that they keep happening again, and again, and again, and again, and again, and have been for at least the past twenty years that I've been paying attention. Every single one of these libertarian projects truly believes that they are the very first people to try this. Every time it ends in scam and disaster. I think the closest I've seen to a success is the cruise ship timeshare.

I feel like there needs to be a "timeline of libertarian utopian failures" somewhere that we can redirect people to before they dump their life savings into this stuff. But I guess part of the whole allure of the philosophy is "we are at the start of history", isn't it.
posted by phooky at 8:51 AM on January 14 [10 favorites]


Years ago, I had a manager who was hard core libertarian (and a Scientologist), who decided I needed to know more about it. He gave me what he called The Bible of libertarianism. The author was also a strict individualist. Property ownership was only in the hands of individuals. If I damage your property then you can sue me since you’re the owner. Such as, I contribute to breaking your leg. But try as could to get a reasonable understanding of what this guy was talking about I kept having this weird idea float around in my head. What if I kill you? There is no owner anymore. When I returned the book I asked my manager what about murder? He told me the author was still working that out. As to the above story, should anyone be surprised? This is a worldview ripe for the taking…
posted by njohnson23 at 9:06 AM on January 14 [14 favorites]


I feel like there needs to be a "timeline of libertarian utopian failures" somewhere that we can redirect people to before they dump their life savings into this stuff. But I guess part of the whole allure of the philosophy is "we are at the start of history", isn't it.

I was watching a bunch of anti-MLM videos recently, and one pattern that kept coming up was "young person in financially difficult situation - doesn't see any good way out - falls for promises from someone who appears to be successful."

As long as we keep minting financially desperate 20-year-olds, we'll keep feeding suckers into these scams.
posted by clawsoon at 9:10 AM on January 14 [20 favorites]


The idea of a "land NFT" is amusing to me. It reminds of when, decades ago, my dad, a devoted Jack Daniel's drinker, participated in some kind of promotion that ended with him getting a deed to a square inch of land in Tennessee.
posted by Well I never at 9:17 AM on January 14 [2 favorites]


I feel like there needs to be a "timeline of libertarian utopian failures" somewhere that we can redirect people to before they dump their life savings into this stuff.
Nobody wants to pay attention in history class.
posted by migurski at 9:23 AM on January 14 [7 favorites]


Quite.

A few press releases:

Telos Kitchen DAO Purchases 36 Acres in Wyoming with Tokens;

or,

The American CryptoFed DAO is legally recognized by the State of Wyoming as the First Decentralized Autonomous Organization (DAO) in the United States

and

American CryptoFed DAO Files with the SEC to Be a Public Company.


From the last, some Stephensonian financial doggerel:

"To become a truly decentralized autonomous organization, we intend to widely distribute a percentage of CryptoFed's Locke governance tokens, free of charge, to contributors, including municipalities, merchants, banks, crypto exchanges, and individuals who will participate in the CryptoFed Ducat Economic Zone. The CryptoFed uses the part and parcel of buying and selling between Locke and Ducat to stabilize Ducat through ongoing open market operations similar to those of the Fed", said Marian Orr, CryptoFed CEO.

Ducat, an inflation and deflation protected stable token, is managed to be stable to purchasing power through time. Inflation and deflation is determined and defined by the Personal Consumption Expenditures Price Index published monthly by US Department of Commerce, the same metric used by the Federal Reserve. Similar to the dollar for the Fed, the Ducat is CryptoFed's daily use currency.
"

That said, a Torrens-style land registry is one of the few decent use cases I can think of for blockchain, setting aside the ecological concerns.
posted by snuffleupagus at 9:23 AM on January 14 [2 favorites]


These dudes who think they can do anything from first principles should have started from something smaller and more maintainable, like maybe owning a hotel first. "I have no experience in hospitality, but I did invest in Holiday Inn ExpressCoin last night."
posted by fedward at 9:25 AM on January 14 [2 favorites]


When I returned the book I asked my manager what about murder? He told me the author was still working that out.

I wonder if this is why so many libertarians seem to be okay with slavery. If someone owns you, at least your murder will be avenged, since it involves the destruction of someone's property.

What I always wondered about is the fact that the whole system seems to be built around utterly incorruptible judges. Where would these magically impartial judges come from in a society based entirely around possession and profit, where nothing would be more valuable than a judge's decision?

Thinking more about MLMs and blockchains/libertarianism, it seems like they're built around gender parodies. In MLMs, you're on a team that'll support and encourage you and everything is positive and loving (except when you fail, in which case you should feel shame for not measuring up to the perfect system you've been given)... it's the very picture of "toxic femininity", if that's a thing. And the trustlessness of blockchains and libertarianism seem like they're the idea that men should be totally independent and able to stand on their own with no support taken to an equally ridiculous extreme.
posted by clawsoon at 9:28 AM on January 14 [14 favorites]


(In case it's not clear to nontechnical people, the 'security breach' described in that quote is the scammer saying "hey I want you to prove that's your house, I need to look at your housekey for a minute" and the cryptobro responding "sure! Here you go!" and then blaming Schlage for the resulting robbery.)

I appreciate this, and the following photoshopped crime analogy, because when I read the relevant paragraph in the article, I wasn't sure I was following it. I was like, "Wait...so the admin tried to get someone to stop pretending to be him, and offered his private info as proof he was who he said he was?" It's like two guys going, "I'm Brad!" "No, I'm Brad!" except the one who is really Brad agrees to hand over his ID, social security number, birth certificate, and the password to his retirement account to prove his identity. "I think you are faking being me!" "Oh yeah? Well, how do I know you are you?"

It really seemed impossible to me that someone who'd jumped into this whole technical blockchain thing that I have avoided learning too much about could be that foolish. You'd think I was born yesterday.
posted by Well I never at 9:35 AM on January 14 [6 favorites]




So let me get this straight: these fools buy into a parcel in Wyoming, obtaining "Land NFTs" that show who holds what chunk of dirt. Then they get robbed, and we have discussions about "how did they think the infrastructure was going to work here".

See, they didn't. At all. The plan was never to build actual infrastructure. Anyone who bought into this expecting to have a physical building on a physical chunk of land was scammed from the get-go. The ultimate goal was to separate morons from their money, and it worked splendidly - except that in the eyes of the originators, the wrong morons got scammed by the wrong person.

Also, "Land NFTs". What the almighty fuck. I have a bit of paper filed with the city clerk telling the world that I own my house and the chunk of land it sits on, which in turn puts me into a set of obligations for maintaining said property and paying the city for certain services. This approach has worked just fine for literal centuries, why the hell does anyone think we now need to burn down the Amazon to power a bunch of blockchain mining rigs to replace this system?
posted by caution live frogs at 9:49 AM on January 14 [23 favorites]


"I have no experience in hospitality, but I did invest in Holiday Inn ExpressCoin last night."

Which reminds me...
posted by clawsoon at 9:58 AM on January 14 [1 favorite]


For a recent timeline of failures, here's an ongoing schadenfreude-filled collection of scams and grift: web3isgoinggreat
posted by autopilot at 10:02 AM on January 14 [24 favorites]


We built this city on block and troll.
posted by kittensyay at 10:08 AM on January 14 [35 favorites]


autopilot, thank you for that web3isgoinggreat link!

I went there and learned that "rugpull" is a new, crypto-related word to describe the apparently-unsurprising move by a system owner to hork all the money out of an EFT scheme. Lovely!
posted by wenestvedt at 10:18 AM on January 14


Just carrying on an old western tradition
posted by TedW at 10:22 AM on January 14


eustatic: "This is so sad."

Alexa, pay Despacito. NO, WAIT --

[$10,000 ETH PURCHASE CONFIRMED. YOUR WALLET NOW OWNS ONE [1] NFT OF THE COVER ART FOR "DESPACITO" BY LUIS FONSI.]
posted by Rhaomi at 10:27 AM on January 14 [9 favorites]


I wonder if this is why so many libertarians seem to be okay with slavery.

I suspect they think they'll be the owners, not the slaves. And given the history of failed libertarian scams, I suspect they're quite wrong.
posted by Gelatin at 10:34 AM on January 14 [7 favorites]


Yesssss....I can repost Bob the Angry Flower.
posted by jquinby at 10:40 AM on January 14 [5 favorites]


Well I never: "The idea of a "land NFT" is amusing to me. It reminds of when, decades ago, my dad, a devoted Jack Daniel's drinker, participated in some kind of promotion that ended with him getting a deed to a square inch of land in Tennessee."

I'd compare it to novelty companies that sell land rights on the moon, but the cryptobros beat me to it.

Also, when it comes to Ethereum smart contacts, what's stopping some enterprising mind from making a contract that says, idk, "by viewing this web page you agree to transfer me all your tokens." Like a malware link that can instantly and irreversibly drain your net worth. It's going to have to be possible if all these claimed of enabling micropayments are true, and the "code is law" approach seems ripe for abuse against people who aren't well-versed in programming.
posted by Rhaomi at 10:44 AM on January 14


DAOs are a classic "solution in search of a problem, which will actually cause bigger problems if implemented". Just utter bollocks.
posted by Lentrohamsanin at 10:59 AM on January 14


Not to sound like a rube, but what does "building a city on the blockchain" even mean? The closest I can get is "the emperor has no clothes" or " a fool and his money are soon parted," but I can't figure out what these people think it meant other than BLOCKCHAIN!
posted by ActingTheGoat at 11:00 AM on January 14 [1 favorite]


There's also a male-oriented ecosphere of scams. You're told you'll get the secrets of investing (not necessarily in crypto, though that might be getting more common), but you spend money and keep getting strung along. There's a youtuber who goes by Coffeezilla who's uploaded a lot about this.

It's "win big" rather than the MLM for women where the hook is "make money at home and spend more time with your family", though the stuff for women might be acquiring more of a tinge of "woman power" and "you just need to imagine hard enough".
posted by Nancy Lebovitz at 11:02 AM on January 14 [4 favorites]


LoL
posted by Ray Walston, Luck Dragon at 11:16 AM on January 14


Any city where 100% of the landowners are pure speculators and rentseekers would be a terrible, terrible place to live.
posted by meowzilla at 11:17 AM on January 14 [3 favorites]


I love that a good deal of all of homeowners in the US must pay "Title Insurance".

If only there was some sort of immutable chain of custody type thing we could use to obliterate that abusive system.

And it if was digital so that it would be easier to search or sort ... that would be great.

Anyways so yeah immoral people taking advantage of the get rich type idiots ... does that define all blockchain or what ?
posted by NoThisIsPatrick at 11:24 AM on January 14


Any city where 100% of the landowners are pure speculators and rentseekers would be a terrible, terrible place to live.

There are condominium buildings here in Toronto like that, and yeah they are quite terrible.
posted by any portmanteau in a storm at 11:25 AM on January 14 [4 favorites]


I love that a good deal of all of homeowners in the US must pay "Title Insurance".

If only there was some sort of immutable chain of custody type thing we could use to obliterate that abusive system.

And it if was digital so that it would be easier to search or sort ... that would be great.


So here in Ontario, the land registration for something like 99% of all properties is electronic using a web-based system. Anyone can go to a different government website and search title documents for a fee although access to making changes is still restricted to lawyers and certain other vetted individuals. Over the last 15 years or so title insurance has taken off to the extent that while it isn't mandatory the client or their lawyer would need a good reason not to obtain it on a property purchase, and if there's a mortgage involved the lender absolutely will require it.
posted by any portmanteau in a storm at 11:32 AM on January 14


Out of curiosity I entertained a brief pre-employment exchange with a project like this in WY that was looking for some compliance help, but I don't think it was this one. It wanted to pay me in fractions of its tokens -- which had already been heavily pre-mined or air-dropped or whatever -- for entire blocks of hours, and with sole approval of the work done and free changes, etc. The amount of work that would've been required for that to turn into any significant amount of land under their scheme was astronomical. Also, they hadn't actually acquired any land yet.

At the same time, they also had a merch store on their promo site where you were meant to be able to pay in their currency (i.e. if you had staked in their DAO and so had some extra coming in, once it was up and running) or in dollars.

When I pointed out that the de facto peg they had created by pricing a t-shirt in dollars and in tokens meant they proposed to effectively pay me a less than a dollar an hour they decided I wasn't a good fit.
posted by snuffleupagus at 11:35 AM on January 14 [20 favorites]


I love that a good deal of all of homeowners in the US must pay "Title Insurance".
If only there was some sort of immutable chain of custody type thing we could use to obliterate that abusive system.


Except the hard part of land ownership transfer, under any realistic system, is not the recording of title, it's the authorization of transfer.

Nobody needs title insurance to verify ownership of the last few official transfers. It's to handle the botched probate of Uncle whoever that should have transferred a 10% ownership to his Nephew ... etc. No amount of really-really-robust trackable receipts can handle that.

And if you want to switch to a Torrens system, then that already works just fine in many places, recorded by the state.
posted by cschneid at 11:55 AM on January 14 [11 favorites]


Im still stuck on trying to understand how land NFTs are different than buying swampland in Florida.
posted by corb at 11:57 AM on January 14 [2 favorites]


The idea of a "land NFT" is amusing to me. It reminds of when, decades ago, my dad, a devoted Jack Daniel's drinker, participated in some kind of promotion that ended with him getting a deed to a square inch of land in Tennessee.

My dad was also a Tennessee Squire. They'd randomly send us stuff, like shot glasses, or records, which is a lot more than you get with NFTs.
posted by Spike Glee at 12:00 PM on January 14 [1 favorite]


Well, corb, if you bought some swampland, you'd at least own some real estate.
posted by SPrintF at 12:01 PM on January 14 [14 favorites]


If only there was some sort of immutable chain of custody type thing we could use to obliterate that abusive system.

Ah yes, immutable. I sure do love when property transactions come with a bonus of "no way to fix errors".
"Whoops, it's the bank's house now, the blockchain says it!"
posted by CrystalDave at 12:05 PM on January 14 [5 favorites]


One thing which gets me about NFTs and the whole cryptobrosphere is how the non-speculation parts are almost entirely dependent on trusting in people's honesty and good faith.
posted by signal at 12:06 PM on January 14 [3 favorites]


And when that fails, the dreaded state and its pathetic human-run courts. To everyone's bemusement.
posted by snuffleupagus at 12:07 PM on January 14 [1 favorite]


Getting your tokens stolen is the natural end-point for these crypto “investments,” but not just for the obvious reasons.
  1. People are bad at writing secure code, so their “smart” contracts have bugs that let attackers take control of the assets and disappear with them.
  2. People are bad at operational security, so it’s easy for attackers to compromise their phones or PCs to get at their credentials, or just trick them into revealing their credentials over Discord or email or whatever, then take control of the assets and disappear with them.
  3. Even if there is no outside attack, an inside attacker (one of the people writing the code, or running the exchange, or acting as agent for the DAO) can take control of the assets and disappear with them (the rug pull).
  4. Even if there is no attacker at all, maybe your cryptocurrency holdings have gained a lot of value, and you want to cash out without paying a lot of tax. So you buy an NFT (possibly one you secretly minted yourself), then report it stolen and write it off as a tax loss. Meanwhile, you launder the proceeds from either the original sale or the sale of the “stolen” property or both, and pocket them cash-free.
The best part is that the insiders in #3 and #4 will naturally try to disguise their fraud as an outside attack like #1 or #2. So when reading about “stolen” tokens, you never know if they were really stolen by an hacker, or just fake-stolen to benefit an insider.
posted by mbrubeck at 12:10 PM on January 14 [12 favorites]


Good.
posted by BostonTerrier at 12:15 PM on January 14


I love that a good deal of all of homeowners in the US must pay "Title Insurance".
If only there was some sort of immutable chain of custody type thing we could use to obliterate that abusive system.


Given the exciting failures of blockchain systems so far, I am enjoying imagining what a reasonable cost of insurance against errors in *that* would be. If you're spending cash, no-one requires title insurance in the old systems, afaik. If lenders all do, that's ... useful information about what regular players of the game know.

I have discovered that my US county uses a Torrence registry for some but not all of its parcels.
posted by clew at 12:19 PM on January 14 [1 favorite]


and pocket them cash-free.
(oops, this should say “tax-free.”)
posted by mbrubeck at 12:22 PM on January 14


We built this city on block and troll.

"Who counts the money underneath the bar?"
posted by They sucked his brains out! at 12:28 PM on January 14


Haven't read the article or this thread, but is it possible this problem can be solved using the blockchain?
posted by gwint at 12:40 PM on January 14 [7 favorites]


snuffleupagus: When I pointed out that the de facto peg they had created by pricing a t-shirt in dollars and in tokens meant they proposed to effectively pay me a less than a dollar an hour they decided I wasn't a good fit.

Reminds me of NFT bro tries to pay me with my own artwork.
posted by clawsoon at 1:03 PM on January 14 [9 favorites]


We built this city on block and troll.

You jest, but from the org's own FAQs, one of its purposes:

Meme making: nuff said - troll the nets and make dank memes

posted by snuffleupagus at 1:03 PM on January 14 [2 favorites]


This makes me want to build a hundred foot high atomic robot of Nelson Muntz that will clomp around North America finding people deserving of ridicule. It will have eyes glowing red like flame and its HA-HA will shatter bones. Its judgment will be absolute, terrible, and beautiful.
posted by GCU Sweet and Full of Grace at 1:05 PM on January 14 [13 favorites]


Obviously I'm here for the schadenfreude and the lulz, but I'm also realizing that the intersection of cryptocurrency and actual tangible assets (specifically land) is going to make for one hell of a courtroom drama some day. Imagine two of these yokels getting into an argument over ownership of a parcel of land, and escalating their insanity all the way to trial court. Some enterprising young lawyer/crypto-bro is going to have to unravel this ball of yarn in a way that a jury can understand. It'll kind of be like the cases with sov-cits claiming the gold fringe around the flag means it's admiralty rules, except with the defense attorneys huffing paint between cross-examinations.
posted by Mayor West at 1:07 PM on January 14 [4 favorites]


“ Any city where 100% of the landowners are pure speculators and rentseekers would be a terrible, terrible place to live.”

Seattle, Portland, SF and a lot of other places are getting this way. That’s why all those people live in tents.
posted by cybrcamper at 1:08 PM on January 14 [8 favorites]


If these people are getting scammed now, wait until they have to deal with the actual mob.

But see, that's the beauty of the blockchain. It creates immutable contracts that make it mathematically impossible for the mob to break your legs if you complain that they aren't picking up your garbage.
posted by straight at 1:14 PM on January 14 [2 favorites]


Some enterprising young lawyer/crypto-bro is going to have to unravel this ball of yarn in a way that a jury can understand. It'll kind of be like the cases with sov-cits claiming the gold fringe around the flag means it's admiralty rules, except with the defense attorneys huffing paint between cross-examinations

I see you haven't been on Twitter lately.
posted by snuffleupagus at 1:15 PM on January 14


Look, it's time we all start learning to live with the giant Nelson robot. It's a mild crushing.
posted by bleep at 1:22 PM on January 14 [5 favorites]


I'm going to try a sympathetic take. I think the root of this problem is the inaccessibility (whether real or perceived) of financial resources and education. Most people are aware that we SHOULD be saving our money in some form of investment account that builds compound interest and equity. I bet the number of people who know what that actually means, and how to execute such a plan, and have the base resources to do it, is a very small segment of the population. But it's plain to everyone that the increasingly small, increasingly distant, proportion of people and institutions who DO have command of those resources are taking huge advantage. That gap is getting bigger and more painful.

So when somebody comes along and says, "Fuck them. We have an alternative. We're building it from the beginning, which means YOU get to be one of the insiders to OUR financial ecosystem. Here's how it works..." people are really receptive to that message. I think that's natural.

So if they (like me, honestly) are just some average person, not an idiot but without a firm command of the details, maybe blundering around with some extra money in their checking that they saved up on expenses working at home during the pandemic, but jaded to the traditional systems that keep making structural problems worse, that makes them a HUGE mark for this shit. The very illustration of "more money than sense."

I don't know. I want to have a laugh at the people going all-in on stupid procedural ape drawings, but I can't. Alls I see is a ship is taking on water, and most of us down in steerage, sizing up the furniture for buoyancy with no idea what even floats.
posted by Phobos the Space Potato at 1:23 PM on January 14 [6 favorites]


Alls I see is a ship is taking on water, and most of us down in steerage, sizing up the furniture for buoyancy with no idea what even floats.

The people I don't have sympathy for in this situation are the ones aggressively marketing concrete blocks as the best life jackets ever.
posted by clawsoon at 1:29 PM on January 14 [6 favorites]


Why would one do this when one can buy imaginary land in Snoop Dogg's metaverse?

Seriously, though, when I first heard about all of this NFT art stuff, I looked into it. On that one big trading site, it says First thing you do is put a bunch of money into a bitcoin wallet... I stopped reading right there and left. Nope.
posted by The Half Language Plant at 1:41 PM on January 14 [3 favorites]


You make a good point about the general environment being one conducive to scams, but allow me to suggest a different conclusion:

Laughing at people going all-in on stupid procedural ape drawings as community immune response. We're already seeing it in different sectors where the NFT vampire-squid is attempting to make inroads.

Example: Konami & Square Enix go in on NFTs, sees backlash, Sega goes "ok, maybe it's not such a good idea if it's going to be received like *that*"

See also, the short attempts at marketing NFTs to furries, before the backlash quickly turned to "I'm going to make NFTs of your fursonas whether you like it or not", and then things were much more mask-off.

If NFTs & blockchain stuff gets talked about as "sure, you can get rich, but it's wild-west out there" that won't deter people. If it's "if you don't know who the mark at the table is, it's you", that might help. If it's "some guy handed the keys to his ape to the wallet inspector, and he had to pay $300k to get it back", that might deter the next person.

It's putting up a sign going "if you touch this live wire, not only will you die, it'll hurt the whole time".
posted by CrystalDave at 1:42 PM on January 14 [14 favorites]


I'm going to try a sympathetic take. I think the root of this problem is the inaccessibility (whether real or perceived) of financial resources and education. Most people are aware that we SHOULD be saving our money in some form of investment account that builds compound interest and equity. I bet the number of people who know what that actually means, and how to execute such a plan, and have the base resources to do it, is a very small segment of the population. But it's plain to everyone that the increasingly small, increasingly distant, proportion of people and institutions who DO have command of those resources are taking huge advantage. That gap is getting bigger and more painful.

Except that money doesn't mean anything anymore. We used to work hard summers, and then we'd have enough money for college. Now it's "well, the sticker price is $50,000/semester, which we recognize nobody can afford to pay except the children of Arab sheiks, but we still have to post the sticker price otherwise the Arab sheik won't pay it. For you, we'll make you fill out a million forms and threaten to take your firstborn child and make you feel grateful that we'll letting you in and the price will be a little less." It's the same with medical care. The value of anything is "what we think we can get out of you," which means that it doesn't have any intrinsic value along the lines of supply and demand or what the market will bear. Why bother learning about investing when there's no actual stated value of the investment opportunity? No wonder naive young people are looking for someone to trust, because they can't trust anyone else.

Seattle, Portland, SF and a lot of other places are getting this way. That’s why all those people live in tents.

Cambridge and Boston MA, too. And take a look at 5th Avenue in Manhattan, where the buildings are half empty. Unlike the Toronto people they are not renting their precious trophies to losers, but why bother having a community at all if no one is in it?
posted by Melismata at 1:42 PM on January 14 [7 favorites]


See also, the short attempts at marketing NFTs to furries, before the backlash quickly turned to "I'm going to make NFTs of your fursonas whether you like it or not", and then things were much more mask-off.

Speaking of mask-off, here's a horror I hadn't seen before:
First there were Jungle Freaks. Then there were the Little Baby Apes. NFTs’ history with race has been… mixed, to say the least. But with both those projects, there was at least some level of plausible deniability about the troublesome imagery.

That is not the case with Floydies, an offensive NFT project that co-opts the image of George Floyd and was launched on the OpenSea platform December 7.
posted by clawsoon at 1:55 PM on January 14 [3 favorites]


Real estate on the blockchain is my favourite bad blockchain idea, because it highlights how utterly terrible the concepts of irreversible transactions, code-is-law, and your-keys-your-problem are.

If the title to my house lives on a distributes consensus blockchain:

1. If I forget my wallet password, can I no longer sell my house? Does it go into ownership limbo forever more?
2. If someone else steals my wallet somehow, do they get to own my house now?
3. What happens to the property if I die and my wallet credentials die with me?

I have a minor hobby of posing these questions to crypto-VCs on Twitter any time they promote the idea of NFTs for real-estate. For some reason they never seem to reply.
posted by simonw at 2:11 PM on January 14 [25 favorites]


I love that a good deal of all of homeowners in the US must pay "Title Insurance".

If only there was some sort of immutable chain of custody type thing we could use to obliterate that abusive system.


This is exactly the sort of thinking that gets crypto people in trouble.

Title insurance isn’t about somebody forgetting who owns the property. It’s about liens and competing claims and just plain insufficient descriptions of the parcel. Those are real, human, legal problems that all the blockchains in the world will not address.
posted by Tell Me No Lies at 2:19 PM on January 14 [18 favorites]


Those are real, human, legal problems that all the blockchains in the world

… will probably just make worse. I can imagine a world in which blockchain title insurance is just as compulsory as regular title insurance is now. Probably more expensive because the risks are no longer as well understood.
posted by fedward at 2:39 PM on January 14 [2 favorites]


That is not the case with Floydies, an offensive NFT project that co-opts the image of George Floyd and was launched on the OpenSea platform December 7.

Dear god. It's a perfect bad object. It's absolutely despicable.
posted by JHarris at 5:19 PM on January 14 [2 favorites]


clawsoon: "That is not the case with Floydies, an offensive NFT project that co-opts the image of George Floyd and was launched on the OpenSea platform December 7."

I'm not going to plumb the depths of sleaze to find receipts, but this was a troll attempt from a pretty overt racist. Which somehow feels a little bit better than someone genuinely trying to memorialize Floyd by turning his image into a cartoon shitcoin.
posted by Rhaomi at 5:32 PM on January 14 [3 favorites]


when somebody comes along and says, "Fuck them. We have an alternative. We're building it from the beginning, which means YOU get to be one of the insiders to OUR financial ecosystem. Here's how it works..." people are really receptive to that message. I think that's natural.


Indeed it is. It’s why we have pyramid schemes and Ponzi schemes and other get-rich-quick gimmicks designed to appeal to people wanting to get one over on the system.
posted by nubs at 6:07 PM on January 14 [2 favorites]


If a person's analysis of the way the world works is built entirely from economic theory, it should not be surprising to find them frequently blindsided by externalities.
posted by flabdablet at 12:44 AM on January 15 [1 favorite]


If a person's analysis of the way the world works is built entirely from economic theory, it should not be surprising to find them frequently blindsided by externalities.

Markets are efficient. There are no bubbles.
posted by clawsoon at 4:35 AM on January 15


Looking for info on the Tonga tsunami BBC this slightly older article was mixed in with the results and just had to post the headline here:

El Salvador Bitcoin city planned at base of Conchagua volcano

 
posted by sammyo at 6:13 AM on January 15 [1 favorite]


Founding your Bitcoin city around a literal Mount Doom is just...

Three Blockchains for the Crypto-brains in on the ruse,
Seven for the Edge-lords in their threads of memes,
Nine for the Easy Marks doomed to lose,
One for the Doge Lord to troll us and scheme;
In twenty twenty-two this is everyday news.
posted by mubba at 7:08 AM on January 15 [9 favorites]


North Korean hackers stole nearly $400 million in crypto last year (Andy Greenberg):
That hoard of stolen cryptocurrency now contributes significantly to the coffers of Kim Jong-un's totalitarian regime as it seeks to fund itself—and its weapons programs—despite the country's heavily sanctioned, isolated, and ailing economy.
Good job, crypto bros
posted by mbrubeck at 7:34 AM on January 15 [4 favorites]


Here in Stockholm, someone keeps putting up stickers promoting a cryptocurrency named Monero, citing its untraceability and potential to push back the state apparatus. Some of the stickers are in Russian, and others are an English translation thereof, replete with the telltale paucity of articles that translations from Slavic languages sometimes have. I'm guessing it's a ransomware gang's local affiliates, or some edgy vape-fedora bros seeking to wrap themselves in the stolen antivalor of the Russian Mafiya.
posted by acb at 7:58 AM on January 15 [2 favorites]


Here in Stockholm, someone keeps putting up stickers promoting a cryptocurrency named Monero, citing its untraceability and potential to push back the state apparatus.

During the 2017 bubble, a coworker asked me to price out a crypto-mining server farm and associated costs. Around the same time, he was also pricing out an automated marijuana grow-op. The main cryptocurrency he was interested in mining was Monero, because apparently it's the only major coin that has the untraceability that the average person thinks Bitcoin or Ethereum have even though they don't.

For better or worse, none of the numbers added up to a profit and neither project happened.

My vague impression is that Monero remains the coin most likely to be used for actual commerce.
posted by clawsoon at 8:20 AM on January 15


If you define ransomware payments as commerce.
posted by acb at 8:37 AM on January 15 [6 favorites]


Monero is yet another proof-of-work boondoggle, so it can fuck off into the sun as far as I'm concerned.
posted by flabdablet at 1:10 PM on January 15 [4 favorites]


The city will be circular to represent the shape of a large coin

Cargo cultism plus how the )(*&@$ does a digital currency have a shape? Plus also if you can mine geothermal energy you can do useful stuff with it without this goddamn inefficient rentier middleman.

I'd look up how much fossil fuel El Salvador imports but I'm pretty sure there's no actual geothermal being harvested yet anyway.
posted by clew at 1:50 PM on January 15 [2 favorites]


I watched The Big Short last night and the parallels of *coin(s) and CDO's just seem to visceral to ignore. The people who think they know what is going on are fools and parasites while the systemic issues are clear to those who do the actual analysis. Any chance we can get a law that prohibits bailouts based on bad *coin investments. Just as a signal to normal people that this stuff is a mire from which no net good will come.
posted by Ignorantsavage at 2:41 PM on January 15 [1 favorite]


So I'm seeing TheSpiceDAO has bought a copy of Jorodowsky's book of concept art/storyboards for his version of Dune for 2.66 million Euros. They plan to make the book public, create an animated series based off of it, and support derivative works from the community.

I'm not sure they are clear that owning a book does not confer publishing rights or enable you to negotiate other rights.
posted by nubs at 11:31 AM on January 16 [6 favorites]


I'm not sure they are clear that owning a book does not confer publishing rights or enable you to negotiate other rights.

These are cryptobros, they are the only ones who have claimed that they are smart.
posted by Ignorantsavage at 12:07 PM on January 16 [2 favorites]




The SpiceDAO pre-debacle probably deserves its own FPP, but maybe we should wait for the upcoming debacle or perhaps the post-debacle debacle. DAObacle? I'm so tired.
posted by gwint at 10:42 PM on January 16 [1 favorite]




That situation's making me wonder what those other guys thought they could accomplish with a copy of the constitution.
posted by RobotHero at 5:32 AM on January 17 [2 favorites]


Saqib still owns Jodorowsky’s bible but is in the process of transferring ownership to the DAO.

What does that even mean? The DAO can have "ownership" I guess, but the physical copy of the book that they've "liberated" still has to be somewhere, in someone's possession...and if that person decides to fuck off with it, what happens?
posted by nubs at 9:20 AM on January 17


Unsatisfied with burning $2 million on a rare book they can't legally use, the Dune cryptofuckers are now considering burning... the book itself. After turning each page into an individual NFT -- using an exotic method of adding JPEG data directly to the blockchain that's probably computationally expensive enough to burn down a small forest.
posted by Rhaomi at 9:57 AM on January 17 [3 favorites]


The SpiceDAO pre-debacle probably deserves its own FPP, but maybe we should wait for the upcoming debacle or perhaps the post-debacle debacle. DAObacle? I'm so tired.

Blockchain threads feel like the new US politics threads. If we made a new one for every new ridiculous thing, the front page would be a never ending stream of them.
posted by clawsoon at 10:09 AM on January 17 [2 favorites]


Only tangentially related: A few weeks ago, someone retweeted a bereft cryptobro, who was wailing "I've been hacked! All my apes are gone!" and since then when I've seen references to crypto, my brain tries using it to make a satirical song, set to the tune of California Dreaming' ("All my apes are gone / And the sky is grey"). I wish it would stop doing that as it's neither big nor clever.
posted by Grangousier at 10:39 AM on January 17 [4 favorites]


Unsatisfied with burning $2 million on a rare book they can't legally use, the Dune cryptofuckers are now considering burning... the book itself. After turning each page into an individual NFT -- using an exotic method of adding JPEG data directly to the blockchain that's probably computationally expensive enough to burn down a small forest.

JFC. I'm not a big Dune person, but this is fucked up: You don't burn books, period. After that, you don't burn rare books. "Move fast and break stuff" indeed; maybe act like a bunch of fucking investors for once - you have something valuable, if you don't know what to do with it you can (a) find another buyer or (b) hold onto it while it appreciates in value or (c) figure out some way to monetize it that doesn't break copyright laws while not destroying the asset? Digitize it and burn the original seems like the most shitty possible outcome.

For people like cortex, this must be like having your hand in the gom jabbar box.
posted by nubs at 10:54 AM on January 17 [3 favorites]


Digitize it and burn the original seems like the most shitty possible outcome.

It's the tech billionaire's plan for earth. So exciting!
posted by clawsoon at 11:42 AM on January 17 [3 favorites]


Unsatisfied with burning $2 million on a rare book they can't legally use, the Dune cryptofuckers are now considering burning... the book itself.

It was new when Robert Rauschenberg erased a de Kooning drawing, but de Kooning was a knowing (if not exactly willing) participant in that. This seems not just derivative but wasteful. The wastefulness is par for the course, but I guess I wouldn't expect blockchain bros to have original ideas. For that matter I'm not sure I'd expect blockchain bros to know much art history either.
posted by fedward at 1:04 PM on January 17


And now we see what David Datuna got wrong: Before he ate that $120,000 banana, he should have put it on the blockchain.
posted by clawsoon at 1:06 PM on January 17


Also, like all things with these alt-right-adjacent fuckers, it's a dominance display.
posted by acb at 1:08 PM on January 17 [1 favorite]


Also, like all things with these alt-right-adjacent fuckers, it's a dominance display.

Their penises are really quiet
posted by cynical pinnacle at 2:01 PM on January 17 [1 favorite]


From the JPEG Minting/Burn the Book link:


1 MB page would cost 177M gas approximately, which at a cost of 100 gwei/gas results in 18 ETH/page.

Ether is approximately $3220 as I type this. So, $57,960 to store one megabyte of JPEG data. And this is using a hack to store it as part of the contract, to make it cheaper than storing state data on-chain.

Cool cool, this is all normal and reasonable stuff, not at all total and irretrievable lunacy
posted by snuffleupagus at 4:04 PM on January 17 [1 favorite]


Ether is approximately $3220 as I type this. So, $57,960 to store one megabyte of JPEG data.

Would it be cheaper to just have someone engrave the images on gold?
posted by clawsoon at 7:53 PM on January 17


Digitize it and burn the original seems like the most shitty possible outcome.

This is like those crazy thought experiments about teleporting people or uploading people's consciousness to computers. If I scan and digitize your brain, then I've just made a copy of you. But if I destructively scan and digitize your brain, then I've actually transferred you into the computer.

Er, no. I made a copy of you and then killed you.
posted by straight at 10:40 AM on January 19 [1 favorite]


Not just a copy, a lossy, compressed copy. Hope you won't miss the parts our perception-based model didn't replicate completely.
posted by fedward at 1:09 PM on January 19 [1 favorite]


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