Pull Your Own Strings

Buterin As FED Chairman

Friday June 17, 2016

A frightening thought huh? This very well may become the case for Ether huffers. Earlier today, The DAO was hacked, and is still under attack as its funds are drained by a malicious entity. This is the result of idiots trusting in a smart contract that could have bugs in it. Just as people do not read paper contracts before signing them, it seems no DAO investor fully read or tested the code composing the organization’s smart contract. Followers of The Most Serene Republic are likely recalling the “mega-thread”TM on the failures of open source software.

The DAO exists as a smart contract on the Ethereum blockchain, however it is vulnerable to recursive split commands. The attacker used this vector of vulnerability to siphon off Ether into a sub-DAO they fully control. After a 27-day window, inherited from the parent contract, the attacker can then begin withdrawing ether. Ironically, this exploit is a direct result of Buterin wanting an blockchain with a Turing complete scripting language.

Zim did it

“Zim hacked the DAO! You have to believe me!”

However, the idiocy doesn’t end here. Dib Buterin decided to take on the role of FED chair of Ethereum by issuing the following statement:

The development community is proposing a soft fork, (with NO ROLLBACK; no transactions or blocks will be “reversed”) which will make any transactions that make any calls/callcodes/delegatecalls that reduce the balance of an account with code hash 0x7278d050619a624f84f51987149ddb439cdaadfba5966f7cfaea7ad44340a4ba (ie. the DAO and children) lead to the transaction (not just the call, the transaction) being invalid, starting from block 1760000 (precise block number subject to change up until the point the code is released), preventing the ether from being withdrawn by the attacker past the 27-day window. This will later be followed up by a hard fork which will give token holders the ability to recover their ether.

That’s right folks, Buterin has the ability to tell the community to have consensus to steal your Ether at any time. You could be right in the middle of huffing it out of a paper bag, and poof it disappears because Buterin said so. Some will claim, “this prevents the attacker from exploiting the DAO, thus it’s a good thing”. Bitcoin never sacrificed it’s freedom to stop scammers – it was the price paid as freedom is not free. When Bitcoinica and Mt. Gox were hacked, no one proposed a hard fork that would allow people to reclaim their coins. Even more frightening, I highly expect this incident to fuel certain crowds to be more vocal for hard forks to reduce scams in Bitcoin. We’ve been so adamant to resist this sort of regulation at the protocol level, meanwhile Buterin not only endorses, but creates it.

The world is definitely not ready for smart contracts, and most are still not ready for Bitcoin.

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