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Illustration: Pete Sharp for Bloomberg Businessweek

The Math Prodigy Whose Hack Upended DeFi Won’t Give Back His Millions

An 18-year-old graduate student exploited a weakness in Indexed Finance’s code, tucking racist epithets into his script, and opened a legal conundrum about theft on the blockchain. Then he disappeared.

From

On Oct. 14, in a house near Leeds, England, Laurence Day was sitting down to a dinner of fish and chips on his couch when his phone buzzed. The text was from a colleague who worked with him on Indexed Finance, a cryptocurrency platform that creates tokens representing baskets of other tokens—like an index fund, but on the blockchain. The colleague had sent over a screenshot showing a recent trade, followed by a question mark. “If you didn’t know what you were looking at, you might say, ‘Nice-looking trade,’ ” Day says. But he knew enough to be alarmed: A user had bought up certain tokens at drastically deflated values, which shouldn’t have been possible. Something was very wrong.

Day jumped up, spilling his food on the floor, and ran into his bedroom to call Dillon Kellar, a co-founder of Indexed. Kellar was sitting in his mom’s living room six time zones away near Austin, disassembling a DVD player so he could salvage one of its lasers. He picked up the phone to hear a breathless Day explaining that the platform had been attacked. “All I said was, ‘What?’ ” Kellar recalls.