Why didn't Citi reverse this wire?
https://www.bloomberg.com/opinion/articles/2021-02-17/citi-c...
Re:In defense of cryptocurrency
by kingaillas on Friday June 10, 2022 @11:19AM
(#31695395)
There's a bit more nuance here than merely Citi wants to reverse a wire transaction. The article explains they were servicing debt and accidentally paid the loan off early (rough summary). The debtors could argue they had no reason to suspect error and viewed the payment as settling the loan.
New payments contracts now include "revlon clawback" clause. The blockchain analogy is a buggy smart contract that gets fixed.
Re:In defense of cryptocurrency
by shakes_mcjunkie on Friday June 10, 2022 @06:17AM
(#31692112)
The article explains why.
They asked the Hedge Fund to transfer the money back. Citi is a bank but couldn't reverse this mistaken transaction and had to go to court.
If this was done by check, Citi could have simply cancelled the check.
When you are moving large sums of money between well known institutions the money is very illiquid, mostly to prevent mistakes, fraud, etc. It’s why most fraud that you hear about involves movement of money overseas or into another type of asset or more liquid form, e.g bills, physical goods etc.
No one sits their stolen funds at chase bank… Makes blockchain and NFTs the perfect gateway for fraud.