Gitcoin, a crypto developer platform, has acknowledged a significant loss of approximately $460,000 in Gitcoin (GTC) tokens. The loss occurred due to an accidental transfer of funds to an unrecoverable contract address.
Transfer Error Explanation
On October 6, Gitcoin’s project lead, Coach Jonathan, shared details of the incident on the Gitcoin governance forum. GTC tokens from the treasury were transferred for a budget proposal related to merchandise, memes, and marketing. However, instead of being directed to a multi-signature address, the funds were mistakenly sent to a GTC token contract address, rendering them irretrievable.
The transaction details and destination address. Source: gov.gitcoin.co
The Lost Tokens
A total of 521,440 GTC tokens, valued at nearly $460,000 (with GTC trading just below $0.90 at the time), were affected by this error. Despite efforts to explore whether the contract had a withdraw function or could be upgraded, it was confirmed that neither option was available, resulting in the classification of the funds as lost.
Future Precautions and Accountability
In response to this incident, the Gitcoin team has outlined plans to prevent similar errors in the future and establish clearer accountability in the event of such incidents. They emphasize the importance of diligence, especially among large token holders and multisignature signers, when handling funds that do not belong to them.
Impact on GTC Token
The GTC token price experienced a 1.1% decline over the past 24 hours, trading at $0.889 at the time of writing. It’s worth noting that the token has seen a substantial decrease of 99% since reaching its all-time high of $89.62 in May 2021, as reported by CoinGecko.
That is really sad to see. Effectively burning half a million $
How come none of the voter/signer noticed? Crypto UX is sadly really broken if this can happen pic.twitter.com/DhI7lPaViY
— Lefteris Karapetsas | Hiring for @rotkiapp (@LefterisJP) October 7, 2023
The incident highlights the challenges of user experience within the cryptocurrency space and serves as a reminder of the importance of thorough verification and precision in handling digital assets.