In a now-deleted profile, an anonymous Reddit user allegedly lost almost $500,000 on Sunday after sending encapsulated ether (WETH) directly to the WETH encapsulation smart contract. WETH emerged as a way to adapt ether (ETH) to the ERC-20 token standard so that it can be traded directly with altcoins imprinted on the Ethereum blockchain.
To wrap Ethereum, users first send ETH to the WETH smart contract address and receive the corresponding token in return. However, in order to cancel WETH, users must either switch ETH to a decentralized exchange such as Uniswap (UNI) or call the withdrawal function in the WETH smart contract. Instead, an anonymous Reddit user sent WETH directly to the WETH smart contract address in hopes of getting ETH back. Unfortunately for the user, this process is equivalent to “burning the token” and results in the irreversible loss of the seller’s cryptocurrency.
Although the user ID is no longer available on Reddit, the transaction is still displayed on Etherscan, showing that 195.2 WETH ($501,358) were sent to the WETH smart contract at the time the publishing contract was published and thus lost forever . Most Reddit members sympathized with the seller, writing u/0150r:
“The accidental loss of half a million dollars in crypto is something that needs to be addressed before crypto becomes mainstream. When everything is so easy to lose, your grandmother will never take advantage of it.
Others, however, pointed out that the original poster should have done a lot more research on the technology before it was used, writing to u/jadecrystal:
“No, you don’t have to develop the technology, but if you don’t have a basic understanding of… a microwave, a starter, an engine, a steering column… or public key crypto addresses and blockchain, that’s what happens.”