I doubt it is legal.
Your opinions are your problem, not mine.
If my bank shuts down and doesn't inform me that in 90 days my money will be theirs to use as they please, I doubt they would get away with it
Instawallet was never designed to operate like a bank.
We provided a free way to store spare change, not accounts. Compare it to a free deposit box if you want but not to a bank.
Why not 900 days? Why not 9 seconds?
This was answered to in my previous post, did you miss it?
90 days are completely arbitrary
It's "is arbitrary", either way yes it is arbitrary. I looked a bit around teh interwebz at the time but found no definitive reference on "How to design a proper claims process in 7 days".
You were welcome to make constructive suggestions at the time the claims process was designed, instead you chose to throw shit at us and post your wallet URL publicly, boo.
and while it might be a nice incentive to get the hacker to come forward
You misunderstand, it wasn't an incentive for him to come forward, it was a protection against him stealing even more money by claiming wallets based on his inside knowledge.