Online crypto-news outlet CoinIdol recently found itself in an awkward situation. It refused to advertise the company of a “suspicious” client after its due diligence uncovered the client had possibly scammed $10,000,000 from people. The awkward part? CoinIdol had already received $1,000 from the client. It found itself in a moral dilemma: should it return what it perceives as stolen money to an alleged thief?
This problem is a complex one. CoinIdol doesn’t want to keep the money; it would like to donate it to charity. However, the news outlet will not be making the decision itself, rather it is calling on the crypto-community to weigh-in. It doesn’t want to simply start a dialogue either; it’s looking to have the crypto-ecosystem self-regulate by actually reading its evidence and voting on what to do with the money (including sending it back to the scammer). CoinIdol wrote:
“We wanted to send that money back, but isn’t it odd to return stolen money to a thief who has taken that money from other people? However, we are not going to keep this money either. We don’t want stolen money. We believe that these funds should be sent to charity. But we want to set a precedent of market self-regulation without police to verify our decision with the votes of the community, just like we do to verify the block in the Bitcoin network. We want to act according to the decision of the crypto community.
We ask you to participate in an open vote on whether to:
1. Return money to [the alleged scammer], whether he is a scammer or not,
2. Not to return money to [the alleged scammer], but rather send it to a charity organization.
We kindly ask you not to vote if you haven’t read the whole text to the end and understood the details of the situation. Together with you, there will be ten honorary members of the jury, whose responsibilities also include sharing their opinion in public, who will participate in the vote.”
The ten pre-selected jury members are CEOs, founders, and board directors of different virtual currency and blockchain technology companies. The first issue that comes to mind about these honorary members is who chose them? That could’ve easily been put to a community vote. Fortunately, those jury members aren’t the be-all and end-all, as their tallied votes will only account for 50% of the total vote taken. The other half of the vote will come from crypto-community members who have read all of CoinIdol’s evidence and would like to participate in the vote.
The entire situation is worrisome. This isn’t about self-regulation regarding compliance to governmental regulations, rather this is more about industry self-policing and internet vigilantism. While it’s understandable to assume some people would agree that it feels weird to return stolen money to a thief, it’s also not farfetched to assume others would question CoinIdol’s authority to take such an action. By giving the money to charity, is CoinIdol effectively robbing the robbers to give to the poor? Can a crime be committed against a criminal? Of course. A person isn’t protected from committing a potentially illegal act by directing their actions at someone they’ve deemed a criminal. That’s why murdering murderers is illegal; just ask Jack Ruby.
This ad hoc trial looks dangerously close to public shaming and potentially even scam baiting, two practices often employed by internet vigilantes seeking justice. Is it for you to decide where someone else got their money? If an alleged scammer’s thievery hasn’t been proven in a court of law, is not returning their money tantamount to stealing?
What’s dangerous is setting a precedent where organizations can investigate other enterprises and make a public judgement upon them, due to the investigating party feeling it has done its due diligence and is not speculating, but stating facts. While this precedent could potentially work with large, universally-trusted organizations, it’s dangerous because it could lead to copycats with good intentions making bad judgement calls for one reason or another. We have the judicial system in America to keep things like internet witch-hunts and doxing from becoming the standard.
Imagine if every time a crypto-enthusiast felt they were slighted by a company or individual, they could simply dig up some evidence (or falsify evidence) that supports their claims. When reputation is often directly linked to trustworthiness in this burgeoning industry, having your name ruined online can be devastating to your projects and interests.
I’m not saying that CoinIdol’s client is a scammer, or not. I’m not saying CoinIdol’s actions are right or wrong. With that said and without judging either side of the argument, the fact that this type of conversation is happening in a transparent manner could be good for the ecosystem, in the long run. Sure, there may be potential legal recourse for those directly involved, but the crypto-community as a whole should benefit from this moral debate.