5 ms·

Even if we agree that Ethereum is still in its early stages we have to ask whether this response is setting a good or bad precedent going forward. Will the pro

Even if we agree that Ethereum is still in its early stages we have to ask whether this response is setting a good or bad precedent going forward. Will the project leadership offer a soft- and/or hard-fork every time a poorly-implemented smart contract is exploited in a manner that is not intended by the contract creators? If every smart contract is going to be "guaranteed" in this way, then this introduces significant overheads for the project and can also create moral hazard. Alternatively, if only some contracts are "guaranteed" but not others, this can introduce opportunities for favouritism or discrimination... Are cases only considered when they affect the ether price or where there is personal involvement with the contract? Is that fair? Interventions and their resolution can also quickly get politicized just like the bank bailouts from the financial crisis. It is not clear this is setting a good precedent. Edit: reworded for clarity

semi-extrinsic 10y ago
Not to mention: you can use the mere claim of yourself knowing a bug in a smart contract to force the other side to do as you say. If it's sufficiently hard to check for bugs, the other party might accept the cost of doing as you say as cheaper than the cost of checking for bugs again. This was a plot mechanism in some SciFi story I read a few years back. Edit: one of the in-universe early Revelation Space books.
- deleted 10y ago
  [deleted]
DennisP 10y ago
In this particular case the contract holds 15% of all ether. The fork won't be enacted unless a majority of the community agrees to run its code. That's not likely to happen except in extreme cases, like this one.
- infodroid 10y ago
  I don't think such a scenario is entirely neutral. Because it implies that some contracts will have a greater probability of being "bailed out" if they are backed by more ether. It may turn out to be a bad thing because it will establish the idea that not all Ethereum contracts are created equal. And this can lead the system to be more centralized.
- riprowan 10y ago
  Exactly. This is being pitched as a negative, when really, consensus-based changes are probably always for the best.
- arghnoname 10y ago
  In other words, this contract is too big to fail?
  - lazaroclapp 10y ago
    Perhaps, but: a) It is being bailed out by referendum, not mandate. Everyone gets a vote, if you don't want to install the patch, don't do it. b) The funds to bail it out are those stolen by the attacker. Nobody is asking people without DAO tokens to suddenly contribute their ether to restoring the DAO or take debt.
    - CoryG89 10y ago
      I disagree in part with (b). A hard fork could split the community and cause the price of ether to crash further. While miners who fork may not actually lose ether in the process, they may actively cause it to lose whatever value it has left. Of course, miners not associated with the DAO would never normally consider risking such a thing, but the rapidly falling price of their ether may convince them that it's the safest move.
    - akhilcacharya 10y ago
      1) TARP arguably had a referendum immediately afterward in the form of the election. 2) The American people were paid back.
    - jjnoakes 10y ago
      Is there really an attacker and stolen funds though? I mean, the contract executed exactly as specified. If the system was well designed, there would be no way to undo the results. Such a system may never exist, but the fact that ethereum can sometimes change contract results means it isn't living up to its ideals.
- drewm1980 10y ago
  Is 15% really that extreme? This is a game; nothing of real value in the world is being created or destroyed (that wasn't already during mining). I personally hope the ethereum community decides to play this game out and not bail out the DAO. It's way too early in the social experiment to change the rules.
  - DennisP 10y ago
    Lots of people have traded serious amounts of real money for those game tokens.
  - CoryG89 10y ago
    I agree that 15% may not be that extreme, but 15% is not all that's at stake. 100% of all ether existing has so far lost 20% of its value (relative to other currencies at the time of the article's writing). I wouldn't be surprised if it continued to drop further. This may cause enough panic among miners to actually get a majority to agree to a hard fork. Edit: for the record, I don't own use Ethereum or own any ether, so I would also hope that a hard fork doesn't happen to bail out a single contract, but I have no financial incentive on the line.

semi-extrinsic 10y ago

Not to mention: you can use the mere claim of yourself knowing a bug in a smart contract to force the other side to do as you say. If it's sufficiently hard to check for bugs, the other party might accept the cost of doing as you say as cheaper than the cost of checking for bugs again. This was a plot mechanism in some SciFi story I read a few years back. Edit: one of the in-universe early Revelation Space books.

deleted 10y ago
[deleted]

DennisP 10y ago

In this particular case the contract holds 15% of all ether. The fork won't be enacted unless a majority of the community agrees to run its code. That's not likely to happen except in extreme cases, like this one.

infodroid 10y ago
I don't think such a scenario is entirely neutral. Because it implies that some contracts will have a greater probability of being "bailed out" if they are backed by more ether. It may turn out to be a bad thing because it will establish the idea that not all Ethereum contracts are created equal. And this can lead the system to be more centralized.
riprowan 10y ago
Exactly. This is being pitched as a negative, when really, consensus-based changes are probably always for the best.
arghnoname 10y ago
In other words, this contract is too big to fail?
- lazaroclapp 10y ago
  Perhaps, but: a) It is being bailed out by referendum, not mandate. Everyone gets a vote, if you don't want to install the patch, don't do it. b) The funds to bail it out are those stolen by the attacker. Nobody is asking people without DAO tokens to suddenly contribute their ether to restoring the DAO or take debt.
  - CoryG89 10y ago
    I disagree in part with (b). A hard fork could split the community and cause the price of ether to crash further. While miners who fork may not actually lose ether in the process, they may actively cause it to lose whatever value it has left. Of course, miners not associated with the DAO would never normally consider risking such a thing, but the rapidly falling price of their ether may convince them that it's the safest move.
  - akhilcacharya 10y ago
    1) TARP arguably had a referendum immediately afterward in the form of the election. 2) The American people were paid back.
  - jjnoakes 10y ago
    Is there really an attacker and stolen funds though? I mean, the contract executed exactly as specified. If the system was well designed, there would be no way to undo the results. Such a system may never exist, but the fact that ethereum can sometimes change contract results means it isn't living up to its ideals.
drewm1980 10y ago
Is 15% really that extreme? This is a game; nothing of real value in the world is being created or destroyed (that wasn't already during mining). I personally hope the ethereum community decides to play this game out and not bail out the DAO. It's way too early in the social experiment to change the rules.
- DennisP 10y ago
  Lots of people have traded serious amounts of real money for those game tokens.
- CoryG89 10y ago
  I agree that 15% may not be that extreme, but 15% is not all that's at stake. 100% of all ether existing has so far lost 20% of its value (relative to other currencies at the time of the article's writing). I wouldn't be surprised if it continued to drop further. This may cause enough panic among miners to actually get a majority to agree to a hard fork. Edit: for the record, I don't own use Ethereum or own any ether, so I would also hope that a hard fork doesn't happen to bail out a single contract, but I have no financial incentive on the line.