Crypto security firm Lorenzo Protocol faced backlash after stating it would only intervene in hacks exceeding $5 million, with critics warning the threshold could incentivize attackers to stay just below the cutoff.
Community members argued that selective intervention creates liability risks and potential regulatory scrutiny akin to money transmitter oversight, particularly when one victim is saved while another is not.
Lorenzo Protocol's $5M Hack Intervention Threshold Draws Criticism Over Perverse Incentives and Liability Risks
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