The counterargument there is that Citibank is currently pursuing a resolution in the courts to that issue, and if they win they will get their $900M back. If you flub a DeFi transaction, you're shit outta luck.
Because that's what real-world security ultimately boils down to: men with guns, ready to drag you where the law tells them to. It's not perfect, but it achieves 99% of the effect at the fraction of a cost of a "trustless" proof-of-work system.
Blockchains solve a very specific problem - decentralized transactions. Unfortunately solving that problem for the world's organized criminals brought a massive amount of heretofore hidden financial activity to light. Consequently, people, most of which don't actually understand blockchains, are trying to replicate this 'bonanza', like moths chasing a light bulb.
There many other use cases for decentralized transactions. But, with so much perceived opportunity at stake, industrial -strength pretzel logic is being applied to the problem, along with eye-popping amounts of venture and FOMO money.
In theory in crypto currency world "staking" is this process.
But that's assuming the judge knows who the thief is. One of the main characteristics of cryptocurrency is that you can hold it without giving anyone your social security number.
In that respect it's much the same as cash -- if you get away with it you keep the money, but if you get arrested, they can order you to return it, and seize your house/car/wages/etc. if you don't.
The issue, which creates the demand for cryptocurrency, is that we don't have a digital equivalent of cash that isn't based on proof of work. But the regulatory system could create one quite easily.
You can, but AFAIK it's harder to do that when you're trying to cash out your cryptocoins in fiat (though arguably, this becomes less of a problem for criminals with the growing numbers of goods and services you can pay for with crypto). Still, I think if governments ever allow for a mainstream, sanctioned adoption of digital currency, they won't let it keep this level of anonymity.
> the court can still order the thief to send back the money.
What if the court can not find the thief? What if the thief is from another nation? What if the thief is another nation?
Who is it that uses these smart contracts, and for what? Is it mostly a gadget for research and speculation (still)?
But - like the internet - it's just a fad that will soon pass.
