High Stakes: Ethereum’s Fight Over Lost Funds Explained By admin on February 23, 2018 Read more
The “computer of the world” is again trapped in a heated debate.
Sparked by a controversial code proposal called EIP 867 the ethereum development forums have become something of a battleground, cluttered with bitter comments, requests for information. 39; tearing and coordinated attempts to erase the idea from the platform’s repository.
For those who are unfamiliar, the conflict surrounds an effort to help ethereum users to recover ether (ETH), the cryptocurrency network (now valued at $ 870 ), describing a process by which could be submitted in a clear and executable format to those who maintain the technology.
No small problem, the losses of funds on ethereum have become frequent.
High-profile cases, such as the removal of a code library from the leading software company Parity Technologies, saw last year 513,774.16 ETH or $ 421 million made inaccessible . And just a few months ago, the same company lost 150,000 ether, or $ 123 million, due to a code error.
But it’s not just parity. Last year, a faulty ethereum address generator saw the exchange and purse supplier Kraken MyEtherWallet lose hundreds of thousands of customer funds.
And still others, whether because of glitch software or simple typos, have lost money on the platform – an address even holds a total of $ 6.3 million in ether because it reflects a call code that automatically blocks funds
But if some users think that the reimbursement of the lost ether is acceptable, a side effect of digital property and the responsibility that arises, others vehemently oppose, estimating that such efforts threaten the integrity of the ethereal platform. liability.
Indeed, even a basic developer resigned from his role as code editor by invoking the legal consequences that might ensue.
Still, the dispute is not new, pointing to a controversial decision promulgated on the platform in 2016 – in which Ethereum has repaid 3.6 million hacked aether in an upgrade to system, or hard fork
Founder of Ethereum, Vitalik Buterin, wrote: :
“For those who thought that the DAO fork was setting a slippery slope without limit and a lasting precedent, I encourage you to see the reactions on this thread.”
In this way, the conflict arising from the EIP 867 shows that both sides of this debate have not yet been reconciled and that there are subtleties at work in each subset. In general, each side can be understood as having a different interpretation of the ethereum.
What is EIP 867 anyway?
In the development of ethereum software, an EIP or ethereum enhancement protocol is the process by which code changes are accepted on the platform.
To add new features to ethereum, software changes are executed as platform-wide upgrades (sometimes called hard forks), but to get to this point, the proposals are subject to a process.
rigorous acceptance. : First of all, if a developer has an idea of a software change, it should be presented as a draw application. As a request for extraction, changes can be easily made to the proposal, and community comments are welcome. Here it also falls under the review of EIP publishers. If the EIP editors find that the request is technically correct and in accordance with the “ethereal philosophy”, they can “merge” it as a project in the next step.
Once merged, software implementations, in the form of various ethereum clients such as Geth and Parity, may take place, and if they work, the proposal may eventually be “accepted”. Once accepted, the platform can be updated with the EIP protocol, provided that the different nodes running the ethereum software decide to upgrade.
However, in this process, EIP 867 is a little different. On the one hand, it does not offer any software changes per se, but simply documents a framework for proposals to follow.
In this case, it falls into another category, called “meta EIP”, which is a way of collecting and formalizing PIEs that fall under a certain category – in this case, the proposals recovery. For this reason, the developers of EIP 867 have given a unique name to the meta EIP: Standardization of proposals for recovery of the ethereum, or ERP.
There have been some proposals of this type.
After freezing funds of $ 421 million last year, Parity Technologies developed several options for recovering funds – all of which were rejected at the time . There is also an EIP named EIP 156 which, written by Buterin, details a method for returning lost funds by Kraken and MyEtherWallet, as well as other popular cases of loss of funds.
According to EIP 867, the failure of these proposals is due in part to “the relatively ad hoc nature of these claims and the subjectivity often required to assess the merits”. As such, the EIP provides “a standardized format for AIPs for fund recovery and an objective standard for measuring future proposals”.
Finally, if it is accepted, the class of ethereum recovery proposals (ERP) EIP will be subject to the same evaluation process of any proposed code on the platform.
Currently, EIP 867 is stuck in phase two of the EIP acceptance process – it’s an unfused project. The former editor of the EIP, Yoichi Hirai, initially rejected the proposal because of his failure to align with the “ethereal philosophy,” one of the categories of judgment in the formal EIP process.
Later, Hirai resigned from his position as Editor-in-Chief of EIP, citing legal concerns that may arise from the maintenance of the project.
And because of its divisive nature, the ethereum developers said that before any other action, the EIP process itself must be re-evaluated further, to clarify whether things like subjective judgment may come into play. View 1: “The code is the law”
When Ethereum was upgraded to recover the funds lost in the $ 3.
6 million DAO hack – now valued at over $ 3 billion – part of the community abandoned the platform. form to create a new cryptocurrency named ethereum classic
On the classic ethereum, which is now valued at just under $ 1 billion, the ethereum platform exists as though the CAD recovery of the 3.6 million ether had never occurred but was definitely lost on the platform.
Influencing this decision was the belief that “the code is the law”, which means that on a blockchain, all executions and transactions are final and immutable and can not be overwritten or corrected, particularly with respect to 39, real money. From this perspective, code errors, such as software errors that can be hacked or broken, are painful but necessary lessons for development.
Because EIP 867 could make such more frequent fixes, hundreds of them decided to express their opinions on Github – some threatening to migrate to ethereum classic.
“If you do not like the possibility of recovering funds use [ethereum classic] .This debate was settled two years ago,” the blockchain architect Cody Burns tweeted .
Because the DAO was largely run by ethereum developers with links to the Ethereum Foundation, many saw the $ 3.6 million refund as a “bailout,” an allegation of developer corruption that persists in the debate EIP 867.
“If you want bailouts, you should stick to fiat,” the main voice of the opposition, Marius Kjærstad, wrote on the wire.
Arguing that such changes are detrimental to the incentive to maintain decentralized registers, software developer Charles Cooper wrote :
“If this process exists, ethereum can no longer be called blockchain, it’s just a central bank that uses minors to validate the majority of transactions.
”
Observing this, we are concerned that EIP 867 is giving developers too much power on the ethereum platform.
Citing a Japanese law, Hirai argued that the movement of funds, especially in the case of imprecise property, exceeded the ability of developers and could expose them to corruption, coercion and corruption.
“I want to be a software developer, not a lawyer,” Alexey Akhunov wrote on the subject of .
On the more moderate side, other voices on this side of the debate argue that the DAO was a one-off, and software upgrades for fundraising should be “rare and increasingly exceptional.” As the platform position that Buterin himself sustained .
To do this, Alex Van de Sande, developer of Mist of the Ethereum, proposed a system for recovering funds without software update, but by creating an insurance pool for refunds.
View 2: “The code is a process”
On the other side of the debate are some of the best ethereum developers, who argue that in cases where the ownership of funds is clear and indisputable, the recovery should take place.
“It really seems to me that the case of lost aether recovery where it is easy to identify the real owner, and to recover it imposes a small burden on everyone, should be clear enough and non-controversial “Johnson, wrote on Twitter .
And such cases are relatively common.
In the examples cited in PEI 156 of Buterin, the funds lost in some cases could be repaid, and according to some, rightly so.
Jesse Powell, CEO of the Kraken Cryptocurrency Exchange, wrote in response to EIP 156 two years ago:
“Speaking on behalf of Kraken, I would say it’s more a reward than a rescue, but we have suffered significant losses following the bug mentioned in the old library. Ethereal javascript was covered out of Kraken’s pocket to protect our customers.
”
Kraken is not alone. Indeed, EIP 156 is littered with comments from other people who have been affected in various ways, each appealing to the community for justice regarding funds lost through no fault of their own.
“MyEtherWallet just burned me for 121 ETH,” an angry user wrote on Reddit .
According to some, ethereum has a responsibility towards its users in these cases.
In addition, by protecting the lost funds, the risk of using the platform would be minimized, which would lead to increased adoption.
And while community consensus is essential for changes to occur on the platform, concerns have been expressed that the strong opposition to EIP 827 is not representative of all Ethereum stakeholders.
Speaking to CoinDesk, James Tevy of Taptrust, one of the proponents of the proposal, said: “One of the tricky things now there is a vocal minority, I do not take for granted that the audience response was totally representative. ”
Tevy adds:
“The great silent minority wants the network to work and as the value of the ether increases, they do not have a dog in this breed.”
Finally, as the PEI 867 is not a proposal for lost funds per se, but rather a standard for formalizing lost fund proposals, there is the argument that the current IEP will not require in itself no controversial change.
Instead, if accepted, the ethereum recovery proposals (ERP) would go through the same rigorous auditing process as the standard EIPs.
In the end, if a controversial proposal is implemented, users might choose not to update their software – which de-synchronizes the dominant chain.
Hand Stitching Cards image via Shutterstock Leader in blockchain information, CoinDesk is an independent media company that strives to achieve the highest journalistic standards and adheres to a rigorous set of editorial policies .
Do you want to offer your expertise or ideas for our reporting? Contact us at . .
