Ethereum price prediction

Can Poloniex survive the Ethereum hard fork?

Can Poloniex survive the Ethereum hard fork? 

I have not received the ETC corresponding to my ETH balance. Most of my ETH was in lending at the time of the fork. It seems like I am not the only user to complain about this issue. What is the rational behind that decision ?

The problem here is that one of the tokens did not exist at all before the fork. One could not be a tokenholder of ETH and ETC before the fork, because there were not two tokens to hold; likewise, there were not two tokens to loan out. The second token came into existence at a certain time and was given to whoever possessed the first token at that time. If your ETH was loaned out when the fork occurred, it was not in your possession. You had exchanged it for a debt of ETH plus interest owed to you. The borrower does not owe you anything possession of this ETH may have earned while it was in his or her possession; the borrower owes you only the ETH borrowed plus the agreed upon interest.

Because loaned assets actually change hands, they may not even have been on Poloniex at the time of the fork. Suppose your borrower sells the borrowed ETH to another trader. This other trader uses their own BTC to buy it in the spot market. They then withdraw it to their own wallet. The fork occurs, and the trader now has ETH and ETC in their own wallet. Neither the lender, the borrower, nor Poloniex has any control over or right to this ETC. The trader is fully entitled to it.

Thank you for your answer. I fully understand your reasonning but I think that if the trader owed money in ETH and if ETH ends up being ETH+ETC than the trader also owes ETC. Poloniex didn’t announce anything of this kind to the lenders and this seems to me a clear lack of due dilligence. Poloniex statement:

“The Ethereum Foundation has proposed a hard fork in response to the DAO exploit, and the community has given this decision the green light. The hard fork will occur at block 1,920,000 on or around Wednesday, July 20th. Since the selection of the winning blockchain is ultimately up to the miners, we will follow the path determined by the miners and the community and make plans to deprecate the losing blockchain. As a Poloniex customer, you do not need to do anything. The migration will occur automatically, and your full balance of Ethereum will be transferred to the winning chain. Keep in mind that as we near the fork, we will be temporarily disabling deposits and withdrawals in preparation for the migration process. Trading will continue to operate as normal during this period. Once the network is stable and the migration is complete, we will enable deposits and withdrawals. In addition, for those interested in keeping their tokens from the losing blockchain as a keepsake, we will support a one-time withdrawal of the deprecated tokens, provided that the losing chain is still functional when you attempt a withdrawal. Specific instructions on how to access your tokens on the old chain to follow.”

People who may have know that they could get “free” (no reimboursement attached) ETC by borrowing ETH before the fork had an inordinate advantage over the others. I hear traders are about to fill a complaint to SEC about this and I must say I really understand their views on this.

Will poloniex make an official statement on this?

As we stated in our public statement, our ETC ledger must balance to zero, and this can only be achieved by crediting those in possession of ETH at the moment of the hard fork. Further, it is worth noting that most of the borrowers who borrowed your ETH, sold these ETH to a spot trader prior to the fork. If you take a moment to consider this, you will realize that the ETC should not be the responsibility of the borrower. Our announcements contain information we have at the time they are made. If you feel we should have been in possession of better, more comprehensive ETH hard fork information that should have afforded for all possible scenarios including this one, consider contacting the Ethereum Foundation and asking them why greater consideration hadn’t been given to the possibility of the losing chain surviving post-fork. That question was asked by us and several other exchanges, as a matter of fact, and the Foundation’s response was that this was not a reality exchanges needed to worry about. This is further evidenced by all exchanges announcing, at around the same time, that they intended to follow the hard fork, making little to no mention of the losing chain nor to the coins on that chain. This was not a coincidence, but rather, proof that exchanges did not conceal pertinent information from their customers. We hope this further explains why this matter cannot resolve any differently than it did.

 

It is clear. They did believe that the chain might survive before the fork. So it surviving was not a surprise as they later make out and they cannot claim that they only changed their minds about listing because the chain survived.

  • Their stated policy was to offer one time withdrawal of tokens on the losing chain if the losing chain survived
  • Their stated policy was to only offer trading on the winning chain even if the losing chain survived
  • They did not say that loaned ETH would not be treated as loans of tokens on both chains.

It is also worth noting that on conventional markets:

  • If the stock pays a dividend the borrower gets the dividend but it is normally the case that dividends must be passed back to the lender as a “manufactured dividend”.
  • If the stock split occurs The borrower gets additional shares and owes the lender these additional shares
  • If the stock split out occurs (e.g. spin off company) the borrower gets both stocks but must return both to the lender.

So poloniex’s policy it is not exactly conventional and it is unreasonable for them to expect lenders to have know that in lending ETH prior to the fork they were giving away ETC.

 

FOR IMMEDIATE RELEASE

THE UPCOMING ETHEREUM HARD FORK

The Ethereum Foundation has proposed a hard fork in response to the DAO exploit, and the community has given this decision the green light. The hard fork will occur at block 1,920,000 on or around Wednesday, July 20th.

Since the selection of the winning blockchain is ultimately up to the miners, we will follow the path determined by the miners and the community and make plans to deprecate the losing blockchain.

As a Poloniex customer, you do not need to do anything. The migration will occur automatically, and your full balance of Ethereum will be transferred to the winning chain. Keep in mind that as we near the fork, we will be temporarily disabling deposits and withdrawals in preparation for the migration process. Trading will continue to operate as normal during this period. Once the network is stable and the migration is complete, we will enable deposits and withdrawals.

In addition, for those interested in keeping their tokens from the losing blockchain as a keepsake, we will support a one-time withdrawal of the deprecated tokens, provided that the losing chain is still functional when you attempt a withdrawal. Specific instructions on how to access your tokens on the old chain to follow.