An unidentified Ethereum user has lost over $500,000 in a costly transfer error. The transaction which was mined on Ethereum block 14104487 shows that the user transferred 195.2 WETH (appr. $517,000) to the Wrapped Ethereum smart contract address.
According to a now-deleted Reddit post by the unidentified Ethereum user, the purpose of the transaction was to convert some Wrapped ETH to ETH. The victim had formerly done some research on how to convert ETH to WETH and was able to carry out a successful transaction by simply transferring ETH to the contract and receiving WETH in return.
However, in an attempt to convert the Wrapped ETH back to the native ETH, the us assumed that the process was the same as the initial conversion. The user transferred WETH directly to the contract instead of the right approach which involves the use of a WETH unwrapping service.
Credit (Mister_Ch0c on Twitter)
Understandably, the mistake cannot be reversed since the Wrapped Ethereum contract, like most token contracts, does not include a function that would allow it to transfer received tokens at the onset.
DeFi Needs a Better User Experience
The issue of DeFi users making mistakes in transactions and losing funds is not new. In a similar incident reported by Coinfomania, an individual sent $400,000 worth of USDT from a Gate.io associated address to the SushiSwap token address.
Another victim also lost funds due to an error in the transaction but was eventually able to recover the assets. The unknown user deposited $1 million in USDT to the smart contract address for decentralized finance protocol, Swerve.Finance instead of supplying the tokens to a liquidity pool in order to receive one of the rewards that the platform promises. Stablecoin issuer Tether came to the user’s rescue as the USDT contract allows for the recovery of such assets.
The case of users losing funds due to basic mistakes emphasizes the need for a more intuitive experience on DeFi apps. Another key takeaway is that potential investors must spend quality time and perhaps money to gain a basic understanding of DeFi apps before getting involved.