I didn't get that from the article at all. The point that blockchains haven't done away with trust is an important one. That the argument that a post-fork blockchain would be less trustworthy than it was before the fork gets made so often tells me this article offers useful information. (The issue with forks isn't whether or not they do occur, but rather whether or not they can occur. A fork that can occur is a fork that just hasn't occurred yet.)
This article veers between erroneous sensationalism and strategic deception.
I will attempt to debunk a few of the most important errors in this article.
In short, the author takes the position that the promise of blockchains is immutability; and that by hardforking, Ethereum proves that "immutability" requires trust:
> We aren’t actually trusting the blockchain technology; we are trusting the people that support the blockchain.
We should start by observing that un-mutated Ethereum - Ethereum Classic - still exists. You can mine its blockchain and run contracts on its virtual machine. So whatever point there was to be made about the untrustworthiness of "immutability" seems false, since the "immutable chain" is still there chugging along. The only problem is that nobody actually wants immutability, once they really think through its permutations.
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I will posit that "immutability" is a red herring. While some people did promise immutability, this was a false promise made by some people. Other people have instead said for years that consensus blockchains like Bitcoin are not - and don't need to be - in fact shouldn't be - "immutable." I will further posit that this is in fact the majority view.
In fact there is a perfectly clear reason why a blockchain might "mutate" and fail to honor the contract as it is written in code: the contract sufficiently harms the economic majority of miners and holders.
And that is why such "mutability" is not bad, but in fact desirable. Otherwise, all that is needed is the invention of some sort of poison contract, and then the network would be unable to administer its own antidote.
This is in fact what happened when someone mined some 90M Bitcoin in 2010 while everyone else was running code that considered these to be valid coins. Obviously, there was a fork, and the perpetrator's 90M Bitcoin were taken out of the ledger. And a good thing, too: if "the code was really the law" then those would still be 90M valid Bitcoin and the whole project likely would have been dead some time ago as the malactor would own something like 90% of the money supply.
> The code was supposed to be the law. If you didn’t see the weakness in the software, that was your problem
Ironically, because this is in fact a true statement, the author's point is exactly wrong.
The code is the law - not just The DAO's code, but also Ethereum's code, on which The DAO depends. Ethereum code is not only also "law", but in this sense, it's the "highest law in the land" with respect to contracts executed on its virtual machine.
It should be patently obvious that Ethereum's code permits forks, "soft" and "hard." It should therefore be patently obvious that any promise of "unstoppable contracts" is simply overpromise. The Ethereum global VM came to consensus that The DAO was not just a failed contract (buggy Ethereum contracts happen all the time) but a failed contract so toxic as to be a threat to consensus.
So, by following one chain, a group of users may declare its will that The DAO contract be "held invalid." By following another chain, a different group may declare its will that the DAO contract be held "valid." Each group actually got its will.
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Consensus blockchains like Ethereum and Bitcoin are not "immutable" and never were, in the sense that all it takes is someone to mine a fork, and the chain "mutates." This is the "permissionless innovation" aspect of blockchains: anyone can create a fork - though it takes a lot of hashpower to protect a fork from hashpower attack.
But on the other hand, consensus blockchains are immutable in the sense that nobody can compel you to follow a "mutated" chain and you are always free to continue to mine on the original chain....
> anyone can create a fork - though it takes hashpower to protect a fork from hashpower attack.
Minor aside, unlike Bitcoin, Ethereum doesn't use hashpower (proof of work) as its voting currency, it uses proof of stake.
So in order to convince the network of a lie, you need to be willing to put up monetary bets against the truth, and then pay them.
This is very unlike Bitcoin, where you buy your mining rig, and then own it. If you pay to fork Ethereum, your real money is at stake.
And the financial incentive for people with even more money than you is to call your bluff and put up a bigger bet against your lie and get the cash and get your lie taken off the books.
Although they have the price structure set up so that calling a bluff is much cheaper than lying. So really even someone with a tenth of your budget can afford to call your bluff.
The article is sensationalist, especially with regard to the "fall" part of the "rise and fall of Ethereum".
The reality is that Ethereum as a platform has gained strength, credibility and market traction over the last six months. There have been 3 hard forks and 1 soft fork, partly in response to the system being under almost continuous attack (mostly denial of service). The effective response by Vitalik and company has increased trust, not decreased it. As the saying goes: "What does not kill you, makes you stronger."
More and more developers building applications on top of this platform. The MelonPort token sale ICO (on the Ethereum platform) sold out in 2.5 minutes yesterday.
It's not just independent Ramen-fueled startups, but "enterprise Ethereum" has become a thing. JP Morgan, Santander, Microsoft, Redhat, Cisco, Accenture, etc -- for better or worse -- are joining the Ethereum bandwagon.
I think it is still way early to call a winner in the blockchain platform wars. There are dozens of well-funded competitors trying to gain dominance over established platforms like the Bitcoin technology stack and the Ethereum platform -- including IBM-led Hyperledger Fabric and the bluechip banking consortium led by R3CEV.
But if there is one dog at the top of the blockchain platform heap right now, it is Ethereum.
I am also bullish on Ethereum. A few points to notice:
- the price is pretty stable relative to early Bitcoin.
- Vitalik and the other devs are still building out economic/game theory models. And Ethereum has successfully made a hard fork. That suggests the organization has some leeway to skate where the puck is going, so to speak.
- it's very early days in terms of building out the "standard library". Lots of people working on this, collectively and privately. It's a little like the railroad tracks have been laid but they are still building the trains, not to mention stations.
- Ethereum has the benefit of being overshadowed by Bitcoin, which insulates it a bit from speculators and scammers. This is only a temporary effect, but I think obscurity helps Ethereum grow smart and slow right now.
- the forums are all about things being built with Ethereum. Bitcoin has a chicken and egg problem, where retailers need to get on board for consumers to care. But nerds can sit down and make something useful on Ethereum today.
I would put one check on this endorsement, though. Ethereum is uniquely useful in situations where you can't trust anyone. It shines in that environment.
Mostly though, we do trust the people around us. I think once the Ethereum community starts releasing big trustless e-institutions, it will be clear that most of them could run just fine with Venmo, WebRTC, and a little JavaScript.
So I think Ethereum will always have a more back-office feel, and I don't quite see it being on The Today Show any time soon.
But Vitalik Buterin is very smart and I wouldn't bet against him.
How did hard forking after the DAO hack increase trust? Wasn't the whole point that "no one" could modify the block chain or the results of a contract?
Now it's established that there's a chance a contract can be "too big to fail".
I think it would have built more trust if they had let the money go. To paraphrase a saying, they would have spent 15% of ETH on training everyone to build safe contracts, and to vet contracts properly before "investing" in one.
> Wasn't the whole point that "no one" could modify the block chain or the results of a contract?
If you hold this view you're going to be very unhappy with the many innovations we'll see in the blockchain space in the coming years: Almost every technology in the future is going to put the desires of the community ahead of any specific piece of code- Computer code is a tool, not the final decision maker.
Forking to add features and expand capabilities is great. I'm not arguing against that. I disagree with forking to undo the effects of a hack on a contract.
You speak as if this was an individual's decision. It was not. Vitalik may be influential, but it was not his decision to fork. The community decided so, by a significant majority.
Didn't the majority of the people deciding to fork stand to profit? I.e. they would restore their DAO funds? That's my understanding and makes me not want to touch Ethereum with a 10ft pole. Seems very much like mob rule vs a system of rules and contracts.
No, the people deciding to fork were the ETH holders. A lot of them owned DAO tokens, but not a majority, probably about 10%. There was a coin vote before the fork which showed about 85% support, and the result was confirmed by the market after the fork (ETH is about 10x more expensive than ETC).
Not sure how anyone could trust it after they reversed a perfectly legitimate transaction.
The whole pitch of ethereum was that it was supposed to be an objective platform, free of human bias, to execute contracts. "The code is the law", they said.
Of course, that was a big fat lie; someone made a shitty contract with a loophole in it. When someone took advantage of that loophole, the devs said "uh, just kidding" and reversed the whole thing.
If I wanted a contract system where humans were able to void contracts, I would use the traditional legal contract system. Ethereum no longer has any advantage.
It was pandering to big stakeholders. That's the problem with all cryptocurrencies, they don't solve big players having huge influence over the underlying currency. It is still very much a "who you know" and "how much profit is at stake" kind of game, which is one of the main reasons people hate state-run currencies. The little guys lose thier shirt and get a "too bad,so sad" response. A big player losses thier shirt and they go cry to thier dev friends who fix the boo boo with a fork. How about we fork on every compliant of someone making a mistake?
You agree with what I stated, but what you wrote that I responded to suggested the community was in agreement on the fork. It was powerful members of the community who stood to lose a lot of money who pushed for the fork, and everyone had to follow unless they also wanted to lose a lot of money. This doesn't look good on Ethereum and saying "the community changed the law" isn't the actual truth, nor really how Ethereum was advertised.
I think any time you get people together to hammer out a plan it's going to be messy and imperfect. However (1) Vitalik didn't have final say on anything (2) Various vote attempts and the message boards seemed to indicate preference for a fork, and this was also the case in my social network. This to me indicates the right decision was made, even if there was probably unfair favoratism on some levels.
> nor really how Ethereum was advertised
This meme is kind of silly to me: Would it be false advertising for BMW to say "Pushing the gas pedal makes the car go forward" after a single BMW had to be taken to the shop because of a broken gas pedal?
(I'm talking about advertising for ethereum in general, not for the DAO itself. I agree the DAO advertising was totally inexcusable for many reasons. I wish I had had the guts to say so more publicly at the time.)
It's much more fundamental than that example though. BMW only guarantees that the gas pedal moves the car forwards in normal operation.
Ethereum even now advertises itself on its homepage as
>Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.
But clearly, we had a program that very specifically ran exactly as programmed, and its operation was interfered by a third party (the community hard-fork). Ethereum offers a guarantee that is not held; this is false advertising.
If it is a guarantee that cannot be held, it is still false advertising.
But even more so, Ethereum imagines itself to have no established authority; to be decentralized. But obviously, it is not. The final say clearly remains with the Ethereum developers, even if the community has the option to secede. (You can renounce your citizenship from the US, everyone can wholesale, but this does not mean the US has no centralized authority.) Bitcoin, of course, offers the same situation; the difference being that bitcoin's authorities do not collude, and by community happenstance, it is unlikely that they will. Such a fork is unimaginable in that universe.
Ethereum (and its many users) imagines itself to be of Bitcoin's equivalence, a large enough and stable enough network that offers little ability and incentive for its authorities to collude. But, of course, this is false. It remains small enough that a hard-fork is viable; proven by the act of a hard-fork.
This is false advertising, in the sense that it misrepresents fundamental components of the system. It might support decentralization given a sufficiently large network, but it does not (yet) have sufficiently large network. But either it pretends its network is sufficiently large, or it pretends that requirement does not exist.
This hasn't been a problem with Bitcoin. No transactions have been reversed because a big player got robbed. The only hard forks in Bitcoin have been due to implementation bugs, and it's only happened once or twice.
You still have most of the power concentrated within the developers, pool owners, and exchanges. This has resulted in major instability due to some of these major players operating effectively scams via either outright stealing or the hiding of major losses.
Most of the issues with currencies(and most everything) is trust and the motivations of other people. Technology might help democratize a world currency, but those who corner the market first will have major influence over it, which in turn will quickly result in the same imbalance in power which was trying to be avoided.
In otherer words, the constitution is above the law. And the constitution allows laws to be changed, in this case by the will of the majority. The same is true for all public blockchains btw.
I'm saying that the main rule for all blockchains (not only Ethereum) is that consensus is decided by the majority. This is their "constitution". The majority of the stakeholders in a blockchain can decide to change the consensus rules. In a traditional legal system majority is not required, laws can be changed by relativly few people.
That's only true with a restricted definition of stakeholders and majority (e.g., miners weighted by mining capacity in Bitcoin). It's not a majority of individuals in the community using the blockchain.
So I'm not sure that it's really all that distinct from legislative majorities in traditional legal system (and clearly less of a genuine majority than in legislative systems where the public retains, whether or not it chooses to frequently exercise them, powers of initiative and referendum.)
I actually meant economic majority because that's what gives the token its value. A >50% hashrate majority in a PoW blockchain can censor transactions, but it's powerless if most users (or most precisely, the users who own most of the tokens) collectively decide to hardfork.
In this system, no transaction is actually final, because it can always be rollbacked because the reversal of a law can traverse time and space. The only gaurantee is once you've got it converted to cash (exited the network) because the network may simply enter a parallel universe where the law never existed (and unlike a hostile government invading another, with all the repurcussions of it, this is a manuever taken by the existing government, and likely it remains the government in the new universe).
This isn't a law then, its simply a communally accepted rule; if the ratchet turns, and community decides slavery is no longer acceptable, then it'll be applied retroactively and you'll be rendered an illegal actor for operating legally at the time of operation, despite operating legally now (no longer dealing in slaves).
The devs didn't reverse it by themselves. There were multiple independent client teams who all agreed to code the change, then they had to convince the community to run the altered software. Not all the official devs were even on board with the change, some stayed neutral, and some of the community refused the change so now we have both ETH and ETC.
So yes, it's possible your transactions will get reversed, but only if you've done something so horrendous that you've pissed off a large majority of the entire community, and in that case you'll likely still have your valid transaction on a working chain, it's just that a lot of people will have gone elsewhere.
Which is the same model as Bitcoin; although my understanding is that consensus would be less likely with Bitcoin since there is a larger and more diverse set of miners.
> So yes, it's possible your transactions will get reversed, but only if you've done something so horrendous that you've pissed off a large majority of the entire community
A large economic majority of the community, you mean. Which gets to the heart of my largest misgiving about these networks: They are so transparently libertarian in striving to embody the Golden Rule ("He who has the gold makes the rules"). If a big actor makes a mistake that benefits 1,000 small actors, the little guys still get fucked.
If the US operated like this, Bill Gates would have ~500,000 more votes than the average American. You could argue that wealthy actors already exert outsize influence on our meatspace contract system, but I'd argue it's to a much lesser extent, and anyway, I don't see Ethereum offering much of an alternative. They don't even pretend to try to strike a balance between individual and community justice.
Economic majority is a copout, and it looks an awful lot like feudalism. As a little guy, I'm hesitant to hitch my wagon to that particular star.
That's basically because we don't have a good solution for Sybil attacks, other than weighting votes by account balances. There are various people trying to fix that by adding real-world identities to the blockchain; the most prominent on Ethereum is uPort: https://www.uport.me/
Not sure why the url path includes 'rise and fall' in it, it doesn't look like it's the actual headline in the article, nor is 'rise and fall' mentioned anywhere in the article.
The main point of the article isn't that people are losing trust in Ethereum. It's that there's no platform that truly avoids the need to trust other human beings (as some apparently believe). That code is not absolute law because the community can choose to change it and affect pre-existing contracts. I don't think he bashes Ethereum at all, but is just making the case that, if you believe you can rely on a platform like this to avoid the need to trust in human decisions, you're fooling yourself.
Fair enough.
Then I'd argue maybe one headline they're A/B testing is sensationalist, but the article itself isn't, nor does it feel like the article is at all making a point about the 'fall' of Ethereum.
You're right, ethereum has not fallen, it has gotten stronger. However, the content of the article does not reflect the title. In fact, your comment just reinforces the point of the article.
This is that trust can never really be fully automated, it is ultimately a human phenomenon. And that is just what happened, the Ethereum community decided, on the basis of the sorts of reasons that human beings normally use, that the whole project and the people running it are trustworthy, and so has charged ahead.
The article says "philosophically interesting" – unless I am missing something, that's a very different thing than what you're claiming the article says.
Big part of releasing new technology is timing. And Ethereum came too soon. Ethreum is big, but people just don't know it and I'm very curious what "news" will send ether up.
In related news, a company built on top of ethereum performed a crowdsale earlier today that ended after 2.5 minutes when their 2 million dollar funding goal was successfully reached. (There is some initial disagreement about how to measure the time appropriately, it may have been several minutes longer)
... And it's quite probably illegal in the US, given SEC rules with respect to privately held companies with large number of owners.
Relatedly, from the Reddit thread:
> ICOs have nothing to do with ethereum. They can raise by any cryptocurrency existing or that will exist in the future. So far, they've mostly been used for scams, although I'm sure some legitimate projects will also be funded.
Is there a meaningful response to this? This is a serious question - how can I tell the difference between an ICO scam, and one that isn't? Are there any examples of sustainable businesses arising from ICOs, or are all of them pump-and-dump schemes?
If I get defrauded by a company putting out an ICO, will anyone go to jail?
The only reason there was a hard fork was because it was Buterin's company that got ripped off. If it had been anybody else, they would have lost the money.
As for "The DAO", the biggest question on their forum is "How do I get out?"[1] Apparently the DAO is dead, but they seem to have kept the money.
It's true some employees at the ethereum foundation had personal money invested in the DAO. Vitalik himself had a small amount invested as well. However, the Ethereum Foundation was not involved with the DAO.
> If it had been anybody else, they would have lost the money
This is idle speculation, and I personally don't think that's true.
> Apparently the DAO is dead, but they seem to have kept the money.
I don't know who you mean by "They" but neither the creators of the DAO, nor the Ethereum foundation has kept any money that was lost in this unfortunate incident. If you're going to accuse people of things please provide citations with evidence.
It looks like there's about $10 million unclaimed in DAO tokens.[1] Soon it will no longer be possible to redeem them, because the infrastructure is disappearing. Getting them back is really complicated.
Well, we can't reimburse those funds since we don't know who the anonymous investors are, and if the ethereum foundation (or whatever) had put the coins into a custodian account then people like yourselves would have complained about that, too.
> It's true some employees at the ethereum foundation had personal money invested in the DAO. Vitalik himself had a small amount invested as well. However, the Ethereum Foundation was not involved with the DAO.
The Foundation itself may not have been invested, but many of the members and core contributors were (Gavin Wood, core contributor of the Rust implementation, was rumored to have over $100k in DAO tokens).
> neither the creators of the DAO, nor the Ethereum foundation has kept any money that was lost in this unfortunate incident.
The hard fork, by definition, allowed everyone to keep what would have been lost.
And it wasn't an "unfortunate incident", it was a publicly stated inevitability, advertised not only by the platform (with the words "unstoppable code" on the home page) but by the authors of the DAO themselves ("Any and all explanatory terms or descriptions are merely offered for educational purposes and do not supercede or modify the express terms of The DAO’s code set forth on the blockchain;").
I didn't agree with the fork, and I choose to follow the majority of miners anyway because I still believe in Ethereum, but quit trying to rewrite history.
First of all the DAO was a decentralized organisation, it didn't belong to Buterin, it isn't "Buterin's company"...
The hard fork had a lot more to do with the fact the overall community didn't thought the system would survive the eventual switch to proof of stake if 15% of all ether was in the hands of malicious actor. There was also the moral matter that something could indeed be done to actually return the stolen money to their original owners, there was consensus to do the fork and so the fork happened.
> the overall community didn't thought the system would survive the eventual switch to proof of stake if 15% of all ether was in the hands of malicious actor
The author of Casper, Vlad Zamfir, clearly stated on numerous occasions on Reddit that there was no risk to PoS b/c of the hack.
> There was also the moral matter that something could indeed be done to actually return the stolen money to their original owners
That's a really nice way of phrasing "we have a moral right to help gamblers recoup their losses."
I have seen stated that even 7% could be an issue depending on the parameters used. Regardless, it was certainly a big concern at the time for most of the community.
That's a bit cynical to call the token holder gamblers, sure many of them "invested" thinking they would get some return back, but a lot of people were genuily curious in participating in this decentralized democracy experiment that never came to be. Regardless even if these people were 'gamblers' stealing is still stealing and returning stolen money is the right thing to do.
> the overall community didn't thought the system would survive the eventual switch to proof of stake if 15% of all ether was in the hands of malicious actor
The author of Casper, Vlad Zamfir, clearly stated on numerous occasions on Reddit that there was no risk to PoS b/c of the hack.
> There was also the moral matter that something could indeed be done to actually return the stolen money to their original owners
That's a really nice way of phrasing "we have a moral right to help gamblers recoup their losses."
The DAO existed mostly to funnel cash to an IOT startup, Slock. They were going to sell network-connected door locks, with some AirBNB like service to manage them for rentals. The COO of Slock was from Etherium.
This was a lot less decentralized than the PR indicated.
I started to read about Ethereum and installed the Wallet but I dont understand why the blockchain size increases so big and how fast ?
It downloaded 500MB on my SSD and I stopped it, I've read that it has to download about 15GB. Thats too much for me. Do the other projects download such big blockchains also ? I mean 15GB for each project ?
If you use a light client the actual size is around 30 MB and takes ~30 seconds. If by "each project" you mean ethereum projects, then no since they share the same chain.
Popular cryptocurrencies process many thousands of transactions per hour, and many wallets choose to retain a large fraction of that data. In which case a few years of operations easily yields dozens of GB of storage.
In theory though, through the magic of Merkle trees, a superlight client could get away with needing only a few KB of storage, accounting for the paths through the Merkle tree that witness its spendable outputs. A discussion about such a setup for Bitcoin can be found for instance at
Ethereum lost all my trust when they hardforked over a contract mistake. They are never getting that back. I'd recommend rebranding the project to focus on the community-driven aspect. They are no better than our current legal framework.
Has the primary language for writing Ethereum contracts been improved? Or is it still a poor language with respect to its type system and other features?
I wasn't that interested in it, but the idea of programmable contracts was intriguing. The main issue is that they should be declarative/logical in nature, as that's what most contracts are, instead the primary language was imperative and had a weak type system (inexpressive). Has this situation improved or are all contracts written in it still destined to have many bugs due to the poor language design?
EDIT: Had to look it up, forgot the name, it's Solidity.
No referential transparency, no purity, no algebraic data types . . . it's scary stuff for writing contracts.
It sounds like the core team has realized what a hole they're in and are taking it seriously, which is great. But I think a lot of the Etherium-related businesses still have no idea what a sandy foundation they're building on. It's going to be ugly.
That's unfortunate. I don't see Ethereum as the future or being long-lived in its current form, but as a proof of concept it has value. Unfortunately, critical flaws in early projects can kill momentum and interest and delay progress for years. See the 1980s and the AI Winter. Overpromised, misunderstood, and underdelivered. This led to reductions in research funding and delays in developments (admittedly, faster and cheaper computers made a lot of those developments either easier or feasible, where the problems being solved may have been intractable in the 80s and 90s).
Solidity is the most widely adopted language, but there are other choices including Serpent (Python-like)and LLL (lisp-like).
A few developers I know use Serpent because it is simple and stable (meaning it has not been changed or updated for a while, unlike Solidity which they say is continually being tweaked in a manner that can be aggravating).
Interestingly, Vitalik's preferred language (say for prototyping Casper algorithms) is Python. He created Serpent and is now working on Viper, which sounds like a next-generation Serpent. Viper is being implemented in Python3.
Python is a nightmare for static analysis. Basing anything contract-related on it is the opposite of reassuring.
I think there are some really cool ideas in Etherium. Proof-of-stake is great. Provably terminating functions are great! These ideas deserve to be paired with a higher level language worthy of them.
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[ 3.8 ms ] story [ 163 ms ] threadExactly once a week, a story like this pops up. Mostly written by someone who thinks that "blockchain is the new big-data of the cloud".
I will attempt to debunk a few of the most important errors in this article.
In short, the author takes the position that the promise of blockchains is immutability; and that by hardforking, Ethereum proves that "immutability" requires trust:
> We aren’t actually trusting the blockchain technology; we are trusting the people that support the blockchain.
We should start by observing that un-mutated Ethereum - Ethereum Classic - still exists. You can mine its blockchain and run contracts on its virtual machine. So whatever point there was to be made about the untrustworthiness of "immutability" seems false, since the "immutable chain" is still there chugging along. The only problem is that nobody actually wants immutability, once they really think through its permutations.
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I will posit that "immutability" is a red herring. While some people did promise immutability, this was a false promise made by some people. Other people have instead said for years that consensus blockchains like Bitcoin are not - and don't need to be - in fact shouldn't be - "immutable." I will further posit that this is in fact the majority view.
In fact there is a perfectly clear reason why a blockchain might "mutate" and fail to honor the contract as it is written in code: the contract sufficiently harms the economic majority of miners and holders.
And that is why such "mutability" is not bad, but in fact desirable. Otherwise, all that is needed is the invention of some sort of poison contract, and then the network would be unable to administer its own antidote.
This is in fact what happened when someone mined some 90M Bitcoin in 2010 while everyone else was running code that considered these to be valid coins. Obviously, there was a fork, and the perpetrator's 90M Bitcoin were taken out of the ledger. And a good thing, too: if "the code was really the law" then those would still be 90M valid Bitcoin and the whole project likely would have been dead some time ago as the malactor would own something like 90% of the money supply.
> The code was supposed to be the law. If you didn’t see the weakness in the software, that was your problem
Ironically, because this is in fact a true statement, the author's point is exactly wrong.
The code is the law - not just The DAO's code, but also Ethereum's code, on which The DAO depends. Ethereum code is not only also "law", but in this sense, it's the "highest law in the land" with respect to contracts executed on its virtual machine.
It should be patently obvious that Ethereum's code permits forks, "soft" and "hard." It should therefore be patently obvious that any promise of "unstoppable contracts" is simply overpromise. The Ethereum global VM came to consensus that The DAO was not just a failed contract (buggy Ethereum contracts happen all the time) but a failed contract so toxic as to be a threat to consensus.
So, by following one chain, a group of users may declare its will that The DAO contract be "held invalid." By following another chain, a different group may declare its will that the DAO contract be held "valid." Each group actually got its will.
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Consensus blockchains like Ethereum and Bitcoin are not "immutable" and never were, in the sense that all it takes is someone to mine a fork, and the chain "mutates." This is the "permissionless innovation" aspect of blockchains: anyone can create a fork - though it takes a lot of hashpower to protect a fork from hashpower attack.
But on the other hand, consensus blockchains are immutable in the sense that nobody can compel you to follow a "mutated" chain and you are always free to continue to mine on the original chain....
Minor aside, unlike Bitcoin, Ethereum doesn't use hashpower (proof of work) as its voting currency, it uses proof of stake.
So in order to convince the network of a lie, you need to be willing to put up monetary bets against the truth, and then pay them.
This is very unlike Bitcoin, where you buy your mining rig, and then own it. If you pay to fork Ethereum, your real money is at stake.
And the financial incentive for people with even more money than you is to call your bluff and put up a bigger bet against your lie and get the cash and get your lie taken off the books.
Although they have the price structure set up so that calling a bluff is much cheaper than lying. So really even someone with a tenth of your budget can afford to call your bluff.
The reality is that Ethereum as a platform has gained strength, credibility and market traction over the last six months. There have been 3 hard forks and 1 soft fork, partly in response to the system being under almost continuous attack (mostly denial of service). The effective response by Vitalik and company has increased trust, not decreased it. As the saying goes: "What does not kill you, makes you stronger."
More and more developers building applications on top of this platform. The MelonPort token sale ICO (on the Ethereum platform) sold out in 2.5 minutes yesterday.
It's not just independent Ramen-fueled startups, but "enterprise Ethereum" has become a thing. JP Morgan, Santander, Microsoft, Redhat, Cisco, Accenture, etc -- for better or worse -- are joining the Ethereum bandwagon.
I think it is still way early to call a winner in the blockchain platform wars. There are dozens of well-funded competitors trying to gain dominance over established platforms like the Bitcoin technology stack and the Ethereum platform -- including IBM-led Hyperledger Fabric and the bluechip banking consortium led by R3CEV.
But if there is one dog at the top of the blockchain platform heap right now, it is Ethereum.
See:
http://www.coindesk.com/jp-morgan-santander-said-join-enterp...
https://media.consensys.net/the-birth-of-enterprise-ethereum...
https://www.reddit.com/r/ethereum/comments/5u6uhb/melonport_...
- the price is pretty stable relative to early Bitcoin.
- Vitalik and the other devs are still building out economic/game theory models. And Ethereum has successfully made a hard fork. That suggests the organization has some leeway to skate where the puck is going, so to speak.
- it's very early days in terms of building out the "standard library". Lots of people working on this, collectively and privately. It's a little like the railroad tracks have been laid but they are still building the trains, not to mention stations.
- Ethereum has the benefit of being overshadowed by Bitcoin, which insulates it a bit from speculators and scammers. This is only a temporary effect, but I think obscurity helps Ethereum grow smart and slow right now.
- the forums are all about things being built with Ethereum. Bitcoin has a chicken and egg problem, where retailers need to get on board for consumers to care. But nerds can sit down and make something useful on Ethereum today.
I would put one check on this endorsement, though. Ethereum is uniquely useful in situations where you can't trust anyone. It shines in that environment.
Mostly though, we do trust the people around us. I think once the Ethereum community starts releasing big trustless e-institutions, it will be clear that most of them could run just fine with Venmo, WebRTC, and a little JavaScript.
So I think Ethereum will always have a more back-office feel, and I don't quite see it being on The Today Show any time soon.
But Vitalik Buterin is very smart and I wouldn't bet against him.
Now it's established that there's a chance a contract can be "too big to fail".
I think it would have built more trust if they had let the money go. To paraphrase a saying, they would have spent 15% of ETH on training everyone to build safe contracts, and to vet contracts properly before "investing" in one.
If you hold this view you're going to be very unhappy with the many innovations we'll see in the blockchain space in the coming years: Almost every technology in the future is going to put the desires of the community ahead of any specific piece of code- Computer code is a tool, not the final decision maker.
Yeah, especially in systems where the fundamental model is code is law
The whole pitch of ethereum was that it was supposed to be an objective platform, free of human bias, to execute contracts. "The code is the law", they said.
Of course, that was a big fat lie; someone made a shitty contract with a loophole in it. When someone took advantage of that loophole, the devs said "uh, just kidding" and reversed the whole thing.
If I wanted a contract system where humans were able to void contracts, I would use the traditional legal contract system. Ethereum no longer has any advantage.
And the law can change if the community deems it wise.
> nor really how Ethereum was advertised
This meme is kind of silly to me: Would it be false advertising for BMW to say "Pushing the gas pedal makes the car go forward" after a single BMW had to be taken to the shop because of a broken gas pedal?
(I'm talking about advertising for ethereum in general, not for the DAO itself. I agree the DAO advertising was totally inexcusable for many reasons. I wish I had had the guts to say so more publicly at the time.)
Ethereum even now advertises itself on its homepage as
>Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.
But clearly, we had a program that very specifically ran exactly as programmed, and its operation was interfered by a third party (the community hard-fork). Ethereum offers a guarantee that is not held; this is false advertising.
If it is a guarantee that cannot be held, it is still false advertising.
But even more so, Ethereum imagines itself to have no established authority; to be decentralized. But obviously, it is not. The final say clearly remains with the Ethereum developers, even if the community has the option to secede. (You can renounce your citizenship from the US, everyone can wholesale, but this does not mean the US has no centralized authority.) Bitcoin, of course, offers the same situation; the difference being that bitcoin's authorities do not collude, and by community happenstance, it is unlikely that they will. Such a fork is unimaginable in that universe.
Ethereum (and its many users) imagines itself to be of Bitcoin's equivalence, a large enough and stable enough network that offers little ability and incentive for its authorities to collude. But, of course, this is false. It remains small enough that a hard-fork is viable; proven by the act of a hard-fork.
This is false advertising, in the sense that it misrepresents fundamental components of the system. It might support decentralization given a sufficiently large network, but it does not (yet) have sufficiently large network. But either it pretends its network is sufficiently large, or it pretends that requirement does not exist.
Most of the issues with currencies(and most everything) is trust and the motivations of other people. Technology might help democratize a world currency, but those who corner the market first will have major influence over it, which in turn will quickly result in the same imbalance in power which was trying to be avoided.
In other words, the code isn't the law, which is exactly what I said.
So I'm not sure that it's really all that distinct from legislative majorities in traditional legal system (and clearly less of a genuine majority than in legislative systems where the public retains, whether or not it chooses to frequently exercise them, powers of initiative and referendum.)
In this system, no transaction is actually final, because it can always be rollbacked because the reversal of a law can traverse time and space. The only gaurantee is once you've got it converted to cash (exited the network) because the network may simply enter a parallel universe where the law never existed (and unlike a hostile government invading another, with all the repurcussions of it, this is a manuever taken by the existing government, and likely it remains the government in the new universe).
This isn't a law then, its simply a communally accepted rule; if the ratchet turns, and community decides slavery is no longer acceptable, then it'll be applied retroactively and you'll be rendered an illegal actor for operating legally at the time of operation, despite operating legally now (no longer dealing in slaves).
It's a pillar of modern democracies that the effects of some law, can only be applied to future events not to past ones.
What ETH did, was create new laws and then proceed to apply them to previous actions. Very untrustworthy indeed.
In the ETH case, you are creating a law to REVERT a previous deal. Democracies don't do that.
So yes, it's possible your transactions will get reversed, but only if you've done something so horrendous that you've pissed off a large majority of the entire community, and in that case you'll likely still have your valid transaction on a working chain, it's just that a lot of people will have gone elsewhere.
A large economic majority of the community, you mean. Which gets to the heart of my largest misgiving about these networks: They are so transparently libertarian in striving to embody the Golden Rule ("He who has the gold makes the rules"). If a big actor makes a mistake that benefits 1,000 small actors, the little guys still get fucked.
If the US operated like this, Bill Gates would have ~500,000 more votes than the average American. You could argue that wealthy actors already exert outsize influence on our meatspace contract system, but I'd argue it's to a much lesser extent, and anyway, I don't see Ethereum offering much of an alternative. They don't even pretend to try to strike a balance between individual and community justice.
Economic majority is a copout, and it looks an awful lot like feudalism. As a little guy, I'm hesitant to hitch my wagon to that particular star.
The main point of the article isn't that people are losing trust in Ethereum. It's that there's no platform that truly avoids the need to trust other human beings (as some apparently believe). That code is not absolute law because the community can choose to change it and affect pre-existing contracts. I don't think he bashes Ethereum at all, but is just making the case that, if you believe you can rely on a platform like this to avoid the need to trust in human decisions, you're fooling yourself.
These days publications are continually A/B testing headlines.
This is that trust can never really be fully automated, it is ultimately a human phenomenon. And that is just what happened, the Ethereum community decided, on the basis of the sorts of reasons that human beings normally use, that the whole project and the people running it are trustworthy, and so has charged ahead.
https://www.reddit.com/r/ethereum/comments/5u6uhb/melonport_...
Relatedly, from the Reddit thread:
> ICOs have nothing to do with ethereum. They can raise by any cryptocurrency existing or that will exist in the future. So far, they've mostly been used for scams, although I'm sure some legitimate projects will also be funded.
Is there a meaningful response to this? This is a serious question - how can I tell the difference between an ICO scam, and one that isn't? Are there any examples of sustainable businesses arising from ICOs, or are all of them pump-and-dump schemes?
If I get defrauded by a company putting out an ICO, will anyone go to jail?
As for "The DAO", the biggest question on their forum is "How do I get out?"[1] Apparently the DAO is dead, but they seem to have kept the money.
[1] https://forum.daohub.org/
It's true some employees at the ethereum foundation had personal money invested in the DAO. Vitalik himself had a small amount invested as well. However, the Ethereum Foundation was not involved with the DAO.
> If it had been anybody else, they would have lost the money
This is idle speculation, and I personally don't think that's true.
> Apparently the DAO is dead, but they seem to have kept the money.
I don't know who you mean by "They" but neither the creators of the DAO, nor the Ethereum foundation has kept any money that was lost in this unfortunate incident. If you're going to accuse people of things please provide citations with evidence.
[1] https://medium.com/curator-multisig-phf-official-channel/dao...
The Foundation itself may not have been invested, but many of the members and core contributors were (Gavin Wood, core contributor of the Rust implementation, was rumored to have over $100k in DAO tokens).
> neither the creators of the DAO, nor the Ethereum foundation has kept any money that was lost in this unfortunate incident.
The hard fork, by definition, allowed everyone to keep what would have been lost.
And it wasn't an "unfortunate incident", it was a publicly stated inevitability, advertised not only by the platform (with the words "unstoppable code" on the home page) but by the authors of the DAO themselves ("Any and all explanatory terms or descriptions are merely offered for educational purposes and do not supercede or modify the express terms of The DAO’s code set forth on the blockchain;").
I didn't agree with the fork, and I choose to follow the majority of miners anyway because I still believe in Ethereum, but quit trying to rewrite history.
The hard fork had a lot more to do with the fact the overall community didn't thought the system would survive the eventual switch to proof of stake if 15% of all ether was in the hands of malicious actor. There was also the moral matter that something could indeed be done to actually return the stolen money to their original owners, there was consensus to do the fork and so the fork happened.
The author of Casper, Vlad Zamfir, clearly stated on numerous occasions on Reddit that there was no risk to PoS b/c of the hack.
> There was also the moral matter that something could indeed be done to actually return the stolen money to their original owners
That's a really nice way of phrasing "we have a moral right to help gamblers recoup their losses."
That's a bit cynical to call the token holder gamblers, sure many of them "invested" thinking they would get some return back, but a lot of people were genuily curious in participating in this decentralized democracy experiment that never came to be. Regardless even if these people were 'gamblers' stealing is still stealing and returning stolen money is the right thing to do.
The author of Casper, Vlad Zamfir, clearly stated on numerous occasions on Reddit that there was no risk to PoS b/c of the hack.
> There was also the moral matter that something could indeed be done to actually return the stolen money to their original owners
That's a really nice way of phrasing "we have a moral right to help gamblers recoup their losses."
This was a lot less decentralized than the PR indicated.
That's incorrect, He was previously in the Ethereum Foundation but left (due to disagreements with Vitalik) long before the DAO was created.
It downloaded 500MB on my SSD and I stopped it, I've read that it has to download about 15GB. Thats too much for me. Do the other projects download such big blockchains also ? I mean 15GB for each project ?
1. Geth/Mist now supports a "light client" mode that requires much less storage and maintains most of the strong crypto guarantees.
2. Most of the size problem is due to the complexity in efficiently optimizing the serialized data, this will improve in the near future.
3. Ethereum is on the forefront of research into scalable blockchain technology, which has the potential to resolve this problem.
In theory though, through the magic of Merkle trees, a superlight client could get away with needing only a few KB of storage, accounting for the paths through the Merkle tree that witness its spendable outputs. A discussion about such a setup for Bitcoin can be found for instance at
https://bitcointalk.org/index.php?topic=88208.msg1896213#msg...
I don't know of any crypto-currencies that have implemented these UTXO commitments that would allow for such wallets though...
I wasn't that interested in it, but the idea of programmable contracts was intriguing. The main issue is that they should be declarative/logical in nature, as that's what most contracts are, instead the primary language was imperative and had a weak type system (inexpressive). Has this situation improved or are all contracts written in it still destined to have many bugs due to the poor language design?
EDIT: Had to look it up, forgot the name, it's Solidity.
http://www.stephendiehl.com/posts/smart_contracts.html :
> "Solidity, while being an interesting proof of concept, is dangerously under-contained and very difficult to analyze statically."
Solidity docs are here: http://solidity.readthedocs.io/en/develop/solidity-in-depth....
No referential transparency, no purity, no algebraic data types . . . it's scary stuff for writing contracts.
It sounds like the core team has realized what a hole they're in and are taking it seriously, which is great. But I think a lot of the Etherium-related businesses still have no idea what a sandy foundation they're building on. It's going to be ugly.
A few developers I know use Serpent because it is simple and stable (meaning it has not been changed or updated for a while, unlike Solidity which they say is continually being tweaked in a manner that can be aggravating).
Interestingly, Vitalik's preferred language (say for prototyping Casper algorithms) is Python. He created Serpent and is now working on Viper, which sounds like a next-generation Serpent. Viper is being implemented in Python3.
You can see the work in progress at: https://github.com/ethereum/viper
I think there are some really cool ideas in Etherium. Proof-of-stake is great. Provably terminating functions are great! These ideas deserve to be paired with a higher level language worthy of them.