Critical Update on DAO Vulnerability • Hacker News Board

Re: Critical Update on DAO Vulnerability

#411

Post by ewillbefull » Fri, Jun 17, 2016, 3:21 PM UTC

RockyMcNuts wrote: post #354

Tinyyy wrote: post #188

> (The soft fork) will later be followed up by a hard fork which will give token holders the ability to recover their ether. Does this mean that transactions are going to be rolled back? If so, are they planning to do this everytime a vulnerability is exploited? Is The DAO too big to fail?

How easy is to tell if you're getting tainted coins? Just the mention of this sort of hard fork means anyone who is exchanging coins for USD or BTC is at risk of being stuck with a hot potato, with impacts on convertibility and confidence in the whole system.

The stolen coins are unspendable for the time being due to the design of the contract.

Re: Critical Update on DAO Vulnerability

#412

Post by qwtel » Fri, Jun 17, 2016, 3:22 PM UTC

kauffj wrote: post #242

imglorp wrote: post #214

This is what concerns me about contract programming. With human contract law, if there's a minor typo or loophole, participants can generally see the spirit and intent, and at worst go to a judge who will usually enforce the intent. But with software contracts, only the characters matter and there's no intent anywhere: either you get paid or you don't. ETH is advising, "Contract authors should ... be very careful abo…

100% agreed and anyone who expects these types of smart contracts to replace typical contracts is overlooking this. The real void smart contracts fill is the type of contracts that cannot be trusted to be enforced by the current court systems. For example, consider prediction markets. Just about any economist or rational person will tell you these are a huge boon to the world, but the CFTC shut down InTrade just a fe…

> Just about any economist or rational person will tell you these are a huge boon to the world

True, but I think said people still haven't taken the whole Taleb idea to heart. I'm pretty sure there are certain domains where the wisdom of the crowd is no wiser then a chimp throwing darts.

As an extreme example, assume you ran a prediction market that predicted the value of the s&p500 x days from now. Would you expect to make money based on these predictions?

This is not to say that they can't be useful in certain domains. It is well known that they do well for binary outcomes like sport events and elections.

They might also be valuable in situations where there are behavioural factors that prevent the spread of information (e.g. whether a project will finish on time). However, there might be simpler mechanisms (like whistle blowing) which could solve the problem or it might not be a problem at all (Bent Flyvbjerg's research on mega projects suggests reliable forecasts are simply undesirable and "true" forecasts are known sub rosa anyway)

A relaxation of the law or more exemptions a la IEM could be beneficial from a research perspective, but I wouldn't expect a "huge boon" just because. These are a lot of words to basically say, it's not a black and white issue.

Re: Critical Update on DAO Vulnerability

#413

Post by JulianMorrison » Fri, Jun 17, 2016, 3:23 PM UTC

DennisP wrote: post #407

wslh wrote: post #255

Earlier quoted context omitted.

I see a different problem here: Ethereum and the DAO were not in a mature state to handle this amount of money. For example, there is a limited support for upgrading contracts in Ethereum and the DAO was not reviewed enough to handle hundreds of million dollars. Also, there are methods to make the software ultra secure using formal models.

Contracts can be upgraded if they're designed that way. You can have a wrapper contract that just calls out to other contracts, where the addresses of the other contracts are updateable. You can even make the callee run in the context of the caller, so all the data is held at the caller, which calls an external function that manipulates it. Doing this is a tradeoff. On the one hand it lets you fix bugs and vulnerabil…

It completely obviates the point, because a contract no longer means what it says, it means what Bob says. So just wire your money to Bob, it's simpler.

Re: Critical Update on DAO Vulnerability

#414

Post by Alexx » Fri, Jun 17, 2016, 3:29 PM UTC

Chris2048 wrote: post #361

Alexx wrote: post #258

Earlier quoted context omitted.

I don't think that is the same - There is no claim that rules of written law always gives the most favourable outcome. But rather that the written law (or contract, in this case) allows for the reality of human error or omission by leaving space for human interpretation, enforcing the underlying intent, rather than strictly enforcing 'bugs' in the contract. After all, there are almost always small mistakes in complex…

There are no bugs, there is just the contract, and the intent, and the difference between the two. My point is, the institution of law needs to be trusted, yet patent-trolling exists because the institution has failed to apply fair judgment and common sense such that ridiculous legal structures have prevailed.

A bug is the difference between the intent and the produced document.

Re: Critical Update on DAO Vulnerability

#415

Post by jeanduluoz » Fri, Jun 17, 2016, 3:29 PM UTC

Looks like security agencies are placing extra guards at important national security sites like the statue of liberty, NSA, and Best Buy: http://i.imgur.com/5c9H6DO.gif

Re: Critical Update on DAO Vulnerability

#416

Post by saalweachter » Fri, Jun 17, 2016, 3:30 PM UTC

Chris2048 wrote: post #240

imglorp wrote: post #214

This is what concerns me about contract programming. With human contract law, if there's a minor typo or loophole, participants can generally see the spirit and intent, and at worst go to a judge who will usually enforce the intent. But with software contracts, only the characters matter and there's no intent anywhere: either you get paid or you don't. ETH is advising, "Contract authors should ... be very careful abo…

> participants can generally see the spirit and intent, and at worst go to a judge who will usually enforce the intent Stuff like patent-trolling (and patents) suggest to me the law isn't so consistently trustworthy as you suggest.

My own skepticism isn't so much stemming from any belief that the current legal systems are particularly great as it is from the learned reflex to be wary of anyone rewriting a system from scratch.

The legal system is complex and messy sometimes because moneyed interests have been keeping a thumb on the scales and sometimes because the world is complex and millions of people have spent hundreds of years patching bugs and extending the code to handle all the weird corner cases.

Smart contracts are a neat idea, but it is also kind of like the guy who wants to rewrite the production system in a weekend.

Re: Critical Update on DAO Vulnerability

#417

Post by to3m » Fri, Jun 17, 2016, 3:30 PM UTC

a2800276 wrote: post #95

nneonneo wrote: post #30

The provided link is just a page showing a bunch of transactions. For someone like me, who is not so intimate with the Ethereum terminology in use (but who is still interested in the DAO, as an observer), could someone provide a layman's explanation of what's going on? Somewhat more specifically, I'm wondering the following: - At a high level, what does this attack actually consist of? - How does ethereum "go missing…

> - At a high level, what does this attack actually consist of? At a high level, The Dao is like Pokemon. Casual observation suggests that it may be a more or less consistent world internally and that a lot of people are very excited about it. A few of those people even claim to fully understand how it works. But there's a lot of fat guys with acne blindly spending on Pokemon cards thinking it's a wise investment. Un…

Ah, thanks... I think I understand Pokemon now.

Re: Critical Update on DAO Vulnerability

#418

Post by programmarchy » Fri, Jun 17, 2016, 3:33 PM UTC

imglorp wrote: post #214

This is what concerns me about contract programming. With human contract law, if there's a minor typo or loophole, participants can generally see the spirit and intent, and at worst go to a judge who will usually enforce the intent. But with software contracts, only the characters matter and there's no intent anywhere: either you get paid or you don't. ETH is advising, "Contract authors should ... be very careful abo…

Keep in mind Ethereum is less than a year old, the DAO is even younger. It's still new, risky, and fraught with problems that need to be solved.

If you're not familiar with anarcho-capitalist theory, there's a concept called a DRO -- dispute resolution organization [1] -- that can perform arbitration functions in a decentralized manner, i.e. without a monopoly on judicial services like the state.

In the future, as the infrastructure matures, I'd be willing to bet DROs will arise to handle these types of disputes. Forthcoming DAOs can be more competitive by integrating dispute resolution clauses into their contracts.

For example, maybe there's a flag that must pass before any transaction takes place, and can fail if X% of DAO stakeholders vote to halt transactions and defer to a DRO for arbitration.

Hard to say exactly how things will evolve, but what's great about Ethereum is that contract law has the potential to evolve at a much quicker, cost effective pace than does the monopolistic, bureaucratic justice system we have in place today.

[1] https://en.wikipedia.org/wiki/Dispute_resolution_organizatio...

Re: Critical Update on DAO Vulnerability

#419

Post by street » Fri, Jun 17, 2016, 3:35 PM UTC

sznurek wrote: post #298

ar0 wrote: post #280

Earlier quoted context omitted.

Agreed. If this soft and hard fork idea really goes through, it seems that now you are in fact getting the worst of both worlds: For your contract, you have to write code that apparently is very hard to get right and bug-free[1], while at the same time you are at the whim of a "community" -- whose decisions (sorry, "suggestions") can apparently be announced by one guy in a blog post -- not to deem what you are doing…

Commenting on your second thought: I hoped that people behind DAO (and Ethereum?) will stick to the terms they themselves proposed but it seems they will push hard for forking the chain (see: Ethereum blog).

The DAO was officially introduced by slock.it with "the code of the contract is the absolute truth, any other description is just a guideline", which was hailed as a new miracle by the investors, but now that it doesn't mean mountains of gold the founding principles are suddenly not important anymore, it seems.

The "hacker" simply used the DAO as it was meant to be used (i.e. according to the smart contract code), and deserves the funds. If there is a hard fork, I hope he sues slock.it for controlling the DAO, and for stealing the funds he is owed according to their own terms ("The contract is king").

Re: Critical Update on DAO Vulnerability

#420

Post by ricksplat » Fri, Jun 17, 2016, 3:36 PM UTC

jchrisa wrote: post #312

sznurek wrote: post #298

Earlier quoted context omitted.

Commenting on your second thought: I hoped that people behind DAO (and Ethereum?) will stick to the terms they themselves proposed but it seems they will push hard for forking the chain (see: Ethereum blog).

Maybe someone can write an insurance contract that future DAO authors can hire, as an alternative to interventions. It would have to be bug free.

Sounds like kernel space code.