Another Costly Mistake: DeFi User Loses Almost $190,000 Worth of SUSHI
While decentralized finance (DeFi) applications have been a blessing to many crypto investors, some continue to lose money.
In the past, a significant percentage of the losses recorded in the crypto industry stems from hacks but since the DeFi boom, more people are losing money due to a lack of understanding of how the DeFi apps work.
Although investors do not have control over preventing their chosen DeFi applications from being hacked, they are responsible for understanding how things are done in the sector.
This lack of understanding has cost yet another DeFi user 9,999.988 SUSHI tokens worth $188,800, as the trader mistakenly sent the funds to the project’s smart contract address.
SUSHI is the native token of the popular DeFi protocol SushiSwap, which was launched on August 26, 2020. SushiSwap which is a fork of decentralized finance project Uniswap was launched in an attempt to be the evolution of the latter via the aid of its “SUSHI tokenomics.”
Like many DeFi projects, SushiSwap also allows investors to provide liquidity to earn rewards or simply hold the SUSHI token and continue to receive part of the fees.
So far, there is over $3.47 billion locked in the protocol and more investors are still taking advantage of the opportunity.
The user while trying to also benefit from the SushiSwap protocol without adequate knowledge, sent the funds to the project’s smart contract address, instead of supplying the tokens to a liquidity pool that pays out the promised reward.
Based on the design of the smart contract, it is almost impossible to recover the tokens sent to the address, unless the project developers implemented a function that allows it to do so.
Since such a function was not implemented on SushiSwap, the $188,800 worth of SUSHI tokens wrongfully deposited to the protocol’s smart contract address is lost forever.
In a similar report, a DeFi user also transferred $329,000 worth of YFI tokens to the smart contract address of yEarn.Finance in September last year.
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