Whenever money is involved there should be a sufficient amount of protection. Money is very important, and services like Paypal require consumers to give out some private information. There should also be more screenings for all of the people on fund raising sites to make sure there are no scams like this.
Yes, there should be more protections. Many people use Twitch as a source of income. If they receive a $50,000 donation from a viewer, that's amazing! That Twitch user can then pay off some of their student debt, better their equipment, further pay off their house, car, or apartment, donate it to charity, or save it, knowing that they are secure for the future should they be unable to continue streaming. But what if the donator takes away that money? Not only did they mess with the user's feelings, but if the user used any of that $50,000, now they're in even more debt because the money stopped belonging to them. Websites with open communities like this rely on trust, especially the websites that are for fund raising specifically. If people can run around giving false money and false hopes, how can any of these websites trust anyone? On Kickstarter, people will increase their pledge amounts just to push the campaign toward the next goal, and then they'll redact themselves, setting the whole campaign back and making it unfair. Others reduce their pledge amounts as the campaign nears a goal, so it takes longer to reach it, and this is also unfairly manipulating the state of the campaign. There needs to be more moderation and protections on websites like these, because these cruel people are never going to disappear completely. It's fantastic that Paypal refused to refund the troller.
I understand that it's very frustrating for obvious trolls to raise money (and receive it) through fundraising sites. However, I think it's a little agitating that a site can decide to withhold the money that was pledged to a cause. If the donators are making their decision to donate, then the money should be donated. The only circumstances that shouldn't be honored should be malicious, obvious deceptions. For instance, if I wrote that I was Mother Theresa who needed money for a floating sky-church, there is NO plausibility behind my claims, and I am doing nothing but deceiving users. But if someone wants to post a ridiculous, troll-y request (e.g. "help me raise $2000 for beard hair implants!" on a lady) then anyone silly enough to contribute should be held to their agreement. Paypal should honor those donations.
In this instance, it was his own damn fault. Why would you donate huge amounts of money and then expect a refund? He though there would be no repercussions to his actions and he was horribly wrong. Maybe this will teach him a well-deserved lesson in life. You are responsible for your own actions.