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Ethereum Devs Hack the Hacker, Price Skyrockets

Last Updated March 4, 2021 4:49 PM
Andrew Quentson
Last Updated March 4, 2021 4:49 PM

Ethereum developers may be pulling a rabbit out of a hat as they secure more than seven million ether and suggest that “[t]here are many plans in place to attack  the child daos and either block the funds or recover them.”

Indications that something was under foot were given yesterday later afternoon when Alex Van de Sande, lead designer at the Ethereum Foundation, twitted that a whitehat attack on the DAO was under way.

After some tense hours, Sande  explained in a public post that “a group of very smart people” which, according to Stephan Tual, were composed of “members of eth foundation, devs, security experts, ethcore, slock,” acting as individuals and not as representatives or with any endorsement of their employers, infiltrated “all open split proposals” and secured 7.2 million eth “now held in a child DAO” with the team holding “the private keys of the curator.”

Fabian Vogelsteller, lead Ðapp developer at Ethereum, stated in a public post:

“We know the curator of the Attacker DAO with 3.5M ether, now 7.2 ether are safe in a DAO where we also know the curator. With a temporary Soft Fork all this ethers can be send to a refund contract and the nightmare is over!”

There seems to be little, if any, controversy regarding the soft fork which has already been merged in Parity, one of Ethereum’s clients, and will be merged in Go within a day or two. According to an ethpool vote , miners are almost unanimously in favor, developers are in full consensus, and most users seem to be in favor.

However, the hard-fork, which has been subject to much debate, may be avoided. Sande, who has been against the hard-fork from the beginning, stated  that the “[h]ard fork is unnecessary at this point.”

Our earlier reporting on the matter had hints that developers may be able to pull a rabbit out of a hat, allowing a clean extinguishment of the fire while keeping the community positive and happy moving forward, with many developers emphasizing that, regarding the hard-fork, all options were on the table and that more options will present themselves as well as that Vitalik Buterin’s hard-fork statement will be retracted.

Price almost instantly jumped on the news, reaching 0.022 from a low of 0.014 btc. At the same time DAO token’s price increased by 41%, considerably narrowing any gap with eth.

Ethereum Price Jumps on DAO Whitehack News
Ethereum Price Jumps on DAO Whitehack News

According to the latest developments, the attacker is on the move again. Lefteris Karapetsas, lead technical engineer at slock.it, stated  that the attacker had “donated some ether into the DAO and joined both whitehat splits,” before adding:

“An attacker in now part of both splits and he can now do the split attack again in both white hat DAOs. This is why we need a soft fork… But DO NOT panic. That means that any other move the attacker would try to do would come after 24 days. And that gives us more than enough time to have the soft fork implemented.”

The DAO split mechanism requires a waiting period of some three weeks. The recursive attack, as far as is known, can be carried out only once that period has expired, but a soft fork is likely to have been implemented before then, with a time estimate of mere days. The attacker, therefore, may be unable to take any funds out of the whitehackDAO.

The story is clearly still developing, but if the team manages to hack the hacker and rescue the funds without a hard-fork, confidence in ethereum is likely to increase considerably as immense skill and collaboration is shown in a very short time.

Featured image from Shutterstock.