So as some of you have noticed ETH has successfully forked, with most of the mining power moving to the new block chain and so did the exchanges.
Another small surprise today happened when Poloniex introduced a new Token named ETC and credited the owners of ETH with an equal amount of ETC. (Actually kodos to Poloniex on this, since other exchanges basically have locked ETC value)
Currently ETC has some support:
https://bitcoinmagazine.com/articles/rejecting-today-s-hard-fork-the-ethereum-classic-project-continues-on-the-original-chain-here-s-why-1469038808
However what Poloniex did for the ETH exchange credits they didn't do for the Lending contracts - basically they decided that the lending contract will be held for the new chain (Yay for the lender!) and that the old chain (ETC now) will not have to uphold the lending contract and therefore the ETC credits went to the borrowers (Yay for borrowers!).
This is the explanation I received from Poloniex:
"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."
IMHO, When Poloniex decided to create ETC tokens they should have credited the lenders with the value of the loans and not the borrowers.
What's your opinion on this?
This is basically bullshit imo. This is why Polo should have announced this in advance and lenders could have made the appropriate decision. I doubt any lender had even contemplated that this was a possibility.
Not really. I think Poloniex is right. If you as a lender didn't have the ETH tokens in your possession at the time it is only fair that you don't get any ETC.
Actually the lender didn't lend ETH, he lent ETC (ETH before the fork) I'm not sure "fair" is an exact description. Under Poloniex logic you could even argue that it make sense to give the lenders only ETC as ETH is actually a new branch in the blockchain.
I started to reply but noticed that you already said the same. Agreed absolutely
Congratulations @rnevet! You have received a personal award!
Click on the badge to view your own Board of Honor on SteemitBoard.
For more information about this award, click here
Comment removed
Congratulations @rnevet! You received a personal award!
You can view your badges on your Steem Board and compare to others on the Steem Ranking
Vote for @Steemitboard as a witness to get one more award and increased upvotes!