Hello and welcome. You are listening to Patrick Boyle on Finance, a podcast exploring ideas from quantitative finance, examining events occurring in markets right now and financial history to see what lessons can be taken away, including interviews with some of the most interesting people in the world of finance. To learn more about the podcast, visit onfinance.org.

A small London-based crypto asset trading platform called Diversify got quite a shock two weeks ago

when it mistakenly paid out a $24 million fee to a large crypto miner.

Transferring crypto deposits generates a fee known in the industry as a gas fee to compensate miners

for the computing energy used to verify transactions on the blockchain.

Diversify should have paid out around $5, but instead transferred $23.7 million due to an error in their code.

On the blockchain, transactions are instantaneous, irreversible and anonymous.

Market participants have no recourse when an error is made.

Without safeguards in place, a polite request is one of the few options left.

In this case, within days the recipient paid the entire amount back in full.

When Diversify saw their mistake, they looked on the blockchain and were able to see that

the recipient was one

of the top 10 Ethereum miners.

Although the recipient was anonymous, Diversify was able to reach out to them and explain

the error and requests that the funds be returned.

Crypto miners often want to be perceived as good actors in the crypto space, so rather than

keep the money, which they could have, they returned it to its rightful owner.

Diversify is a defy platform that allows buyers and sellers to trade digital tokens without

going through a centralized exchange.

Crypto enthusiasts point to the fact that the money was quickly returned as proof of shared

community values in the defy space.

Will Harbourn, the CEO of Diversify, is obviously delighted that this happened.

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