BTC Miner Reimburses Paxos for $500K Transaction Fee Error

BTC Miner Reimburses Paxos for $500K Transaction Fee Error

Time Stamp: September 15, 2023 8:44 AM
Source Node: 2882306

Paxos successfully secured half of the million it mistakenly paid in Bitcoin transaction fees.

A Bitcoin miner has reimbursed stablecoin issuer Paxos for an accidental overpayment of approximately $500,000 in Bitcoin (BTC) transaction fees.

On September 10th, the crypto community noticed a Bitcoin transaction, processed with a staggering $500,000 fee for a mere $2,000 transfer. At the time, the typical network fee for a Bitcoin transaction was around $2.

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Various theories emerged to explain the unusually high fee, including speculation that the payer had copied and pasted data incorrectly, leading to the mistake.

Three days after the unusual transaction, Paxos admitted that it was the entity responsible for the error. The firm quickly reassured its customers that all funds were safe and the blunder was solely on their end. Paxos also explicitly stated that its partner, PayPal, had no involvement in the transaction mistake.

Less than 24 hours after Paxos’s acknowledgment, the Bitcoin miner who had initially received the payment took to social media platform X (formerly Twitter) to express their dilemma. The miner polled their followers on what to do with the unexpected bounty, and the majority favored distributing the extra funds among the mining community.

Despite the popular vote, blockchain data from Bitcoin explorer Mempool revealed that the miner returned the funds to Paxos on September 15th.

This incident wasn't the first of its kind; high-stakes mistakes in transaction fees have occurred before. In 2019, an Ethereum user inadvertently lost close to $400,000 in Ether (ETH) due to a similar error. However, in that instance, the Ethereum mining pool Sparkpool intervened to help the user recover half of the lost funds.

The Bitcoin miner's decision to return the excessive transaction fee to Paxos showcases the integrity of the crypto community. While transaction errors are not unheard of, this incident serves as a cautionary tale for both companies and individual users to be vigilant when processing large transactions.

Gile is a Market Sentiment Analyst who understands what public events may form what emotions. Her experience researching Web3 news and public market messages – including cryptocurrency news reports, PRs, and social network streams – is critical to her role in helping lead the Crypto News Editorial Team.
As an intelligent professional in public relations, together with the team, she aims to determine real VS fake news patterns, and bring her findings to anyone searching for unbiased news and events happening in the FinTech markets. Her expertise is uncovering the latest trustworthy & informative Web3 announcements to the masses.
When she's not researching the trustworthiness of mainstream stories, she spends time enjoying her terrace view and taking meticulous care of her outdoor environment.

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