The Ethereum community has a monumental and historical decision to make after the shocking theft of $50 million held on the DAO smart contract. The proposed solutions by the Ethereum’s developer community to the on-going hack is a fork, according to a Critical Update by Vitalik Buterin.
The decision, however, stands with Ethereum’s community, according to George Hallam, one of the developers of Ethereum who, speaking to CoinTelegraph, stated:
“We can provide code which would allow [the fork], but the community as a whole has to come to consensus on how we move forward on this. It is not the foundation’s decision. I think everyone would agree with that.”
Hallam stated that the community consensus will be measured by “[w]hether miners choose to adopt [the fork],” with a time estimate on merging and release of the fork client to be provided “[s]oon - more on that soon.”
According to Griff Green, a spokesman for Slock.it, the hacked ethers are “locked in a Child DAO, so they will not be able to get the ETH out” for another 27 days. The monumental decision, therefore, will need to be made in days or just a couple of weeks.
To Fork or Not To Fork
A lively debate has already began across reddit, twitter, the DAO slack channel and forums. We spoke to three small miners and all seemed in favour, with one of them stating that he had no choice, but to support the fork.
In an update explaining that both the child and main DAO will be frozen in a softfork to be followed by a hardfork to allow the funds to be sent to a new smart contract where token holders can withdraw their share, Green stated:
“It is important to note that both of these suggested paths forward have a lot of support from the Vitalik and the other leaders of the Ethereum community and it will only affect a small part of the Ethereum blockchain.”
The main argument against is a slippery slope argument, often advanced by Bitcoin holders. They argue that if Ethereum hardforks to prevent the thief from running with $50 million or more, then they may hardfork to stop drug users next, or prevent donations to wikileaks.
Adam Back, President of Blockstream, stated to CoinTelegraph:
“Bitcoin never hardforked. The developers who had funds stuck in mtgox on principle rejected out of hand even the suggestion of a hard-fork to return funds. The idea to hard-fork ethereum because some users made an ill-advised investment governed by a poorly written smart-contract is conflict of interest writ large given coin ownership.”
The argument against is seemingly further supported by Alex van de Sande, an Ethereum developer and one of DAO’s curators who stated in a public post that he does not like the fork proposal and doubts “this hard fork to recover funds will ever happen - nor it should even be technically possible to do it.”
A Defining Decision for Ethereum
Some argue that the situation is exceptional and the contract is “too big to fail”, thus, miners, acting as a decentralized jury, can deny the thief his ill-gains. The further benefit may be that the fork may deter further spectacular thefts as the miner jury may hack the hacker and take his stolen loot.
Allowing the theft to stand is likely to seriously shake confidence in Ethereum which passed $20 per coin. They have surprisingly managed to smooth sail from nothing to a market cap of more than $1.6 billion prior to the hack, finding wide acceptance by established businesses. All of that is likely to be placed in serious jeopardy if this whole concept once more is spectacularly proven to the world to have a fully not safe and easily stolen digital currency.
However, it is not an easy decision to make as the path Ethereum’s community chooses is likely to be decisive in defining its future long term direction and the likelihood of succeeding in their bid for mainstream adoption.
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