A DeFi blog, Rekt has called out the popular centralized exchange, FTX, for charging one of its user an alleged $1M gas fee. In FTX terms and conditions, a minimum of 5% is deducted from any transfer to a wrong address. This is the case when the FTX user mistakenly sent $6.3 million in USDP to the platform.
The FTX user claims to have been misled by the platform, after the platform named another token the same name. The initial USDP, which the user wished to deposit, is a stable token for the decentralized borrowing and lending platform Unit Protocol. However, FTX recently rebranded another stablecoin token Paxos as USDP and also changed the original PAX sticker to USDP. This misled the user to transfer $6.3 million to Paxos stablecoin instead of the Unit Protocol stablecoin.
After a formal report was made to the centralized exchange, FTX returned an estimated sum of $5.4 million to the user, resulting in a 15% fee. As we might consider this a win-win situation for the platform and the user, the user still feels cheated and has called out FTX for going back on their wrong address and Chain policy. Also, considering that the platform also contributed to the user depositing in the wrong address, over $1m fees seems to be a lot.
About the users’ claim of the platform going back on its wrong address policy, FTX’s wrong address policy states that “a minimum of 5% may be levied if the exchange has to recover deposits to an incorrect address.” Considering the role of the platform in the situation, a 15% fee seems too much, and they are expected to take responsibility to uphold their legacy of trust. Do you think a 15% fee was fair in this case?