Here is a very illegal, totally ineffective get-rich-quick scheme:
1. Borrow a billion dollars for a day. 2. Buy 51% of the shares of a small bank. 3. Hold a vote amongst the bank’s shareholders to send all the money in the bank’s vaults to you, which you win, because you own 51% of the shares of the bank. 4. Sell your shares in the bank. 5. Pay back your billion dollar loan.
The scheme is illegal because, well, almost all the individual steps are themselves illegal. A board vote cannot simply transfer corporate assets to a majority shareholder, that would be embezzlement, a crime; a bank cannot transfer assets in its vault as it sees fit, because then it wouldn’t meet reserve requirements, a crime.
And it’s ineffective to boot: you would find it tricky to borrow a billion dollars, buy up all your shares in the bank, and hold a vote amongst the bank’s shareholders to take the bank’s reserves before the bank’s customers discovered your scheme and raced to be the first to withdraw their assets.
Here is a maybe legal, definitely effective get-rich-quick scheme:
1. Do the same thing, but in crypto.
From our story:
The Beanstalk cryptocurrency has been stripped of reserves valued at more than $180m (£138m) in seconds, after an attacker used borrowed money to snap up enough voting rights to transfer the money away.
A still-unidentified attacker had borrowed $80m in cryptocurrency and deposited it in the project’s silo, gaining enough voting rights in exchange to be able to pass any proposal instantly. With that power, they voted to transfer the contents of the treasury to themselves, then returned the voting rights, withdrew their money, and repaid the loan – all in a matter of seconds.
Beanstalk was – is, technically, though the
Read more on theguardian.com