Starkware Wiped $550K From 'Deprecated' Crypto Wallets—Then Gave It Back

Starkware has agreed to re-enable access to its outdated wallets after temporarily locking users out of $550,000 worth of their own money.

“When 0.12.1 went live, accounts that were not upgraded, became temporarily inaccessible,” tweeted Starknet on Wednesday. “As of today, the upgrade is reenabled, allowing users to immediately regain access to their accounts.”

“For technical reasons, it may take until tomorrow for users of Argent and Braavos to regain access,” the company added.

According to Ana Vukina—a customer support agent for the Ethereum layer-2 wallet Argent—all accounts that users failed to upgrade to Starknet’s latest smart contracts by August 21 were rendered “deprecated” and unusable.

“Over the last year, we have communicated about the need to upgrade your wallet, and that any wallet that did not upgrade by this date would be lost,” Vukina told a disenfranchised Starknet user over Discord on Tuesday.

“This is a network-specific change, not one that we control, unfortunately,” she clarified at the time. “According to Starkware, the wallets that did not upgrade in time will lose their assets.”

Starknet is a decentralized layer-2 network for scaling Ethereum transactions. It uses ZK-rollups to achieve this, bundling many transactions together before posting them to Ethereum’s main blockchain as one transaction.

Vukina explained that Starknet is a “new rapidly developing network,” that’s undergone numerous major upgrades and changes in preparation for full launch. Both Starkware and Argent have warned users about the upgrade for months and urged them to save their funds across various social channels.

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Despite the warnings, many were not pleased with Starknet’s initial approach.

“Networks that allow you to lose access to user funds due to 'network upgrades' deserve to crash and burn imo,” tweeted Starknet user Belgio on Wednesday. “Does not matter what type of communication put out, people go inactive all the time.”

Others said that alternatives were available that would protect all user funds, without slowing Starkware’s pace of innovation. “They could have done an upgrade where the assets were not lost but rather moved to a claim address and issued a merkle tree/proof for recovery,” argued one Twitter user.

According to Starkscan, over $78 million in assets are locked within Starknet accounts, of which $546,000 are in “out of date” accounts. About 15% of the network’s 2.1 million accounts are out of date.