Slashdot Mirror
Researchers Criticize New DAO Ethereum VC Fund (softpedia.com)
Three cryptocurrency experts published a scientific paper Friday detailing seven attacks that could influence how the Decentralized Autonomous Organization (DAO) allocates its Ether funds. An anonymous Slashdot reader writes, "Coincidentally or not, they released their work with one day before funding for the DAO closed, and not surprisingly, Ether's price went down, devaluing the DAO from $150 million to $132 million."
From Softpedia: DAO is a crowdfunded project that works on the Ethereum network, a new crypto-currency network that deals with crypto-currency named Ether, which many experts say is better than Bitcoin's blockchain... Investors can submit funding proposals, on which the DAO users vote by submitting some of their tokens and a YES/NO vote. In the end, based on the tokens and YES/NO votes, the DAO's computer program decides on the outcome.
Softpedia reports that the paper released Friday also suggests a series of mitigations to a design they say will "incentivize investors to behave strategically; that is, at odds with truthful voting on their preferences."
From Softpedia: DAO is a crowdfunded project that works on the Ethereum network, a new crypto-currency network that deals with crypto-currency named Ether, which many experts say is better than Bitcoin's blockchain... Investors can submit funding proposals, on which the DAO users vote by submitting some of their tokens and a YES/NO vote. In the end, based on the tokens and YES/NO votes, the DAO's computer program decides on the outcome.
Softpedia reports that the paper released Friday also suggests a series of mitigations to a design they say will "incentivize investors to behave strategically; that is, at odds with truthful voting on their preferences."
Bitcoin's "success" (if you can call it that) is related directly to its algorithm which to this day is unbroken.
Any new system is subject to crazy ridiculous review, obviously. No one, I mean no one accepts this new system for anything. The fact that it made a Slashdot front page is pure greed (in terms of Slashdot whores) and means nothing whatsoever. Sorry I'm just an AC dope with no knowledge. Continue on, morons.
It's not everyday that a scientific publication has an impact of $18 million.
It's also not everyday that you see a scientific publication entirely drawn up in Google Docs, let see if they can organize a peer review process this way.
Interesting excerpt from the work:
Among the current DAO investors, there is already a whale who invested 888,888 Ether. This investor currently commands 7.7% of all outstanding votes in The DAO. For a proposal that requires only a 20% quorum, this investor already has 77% of the required YES votes to pass the proposal, and just needs to conspire with 2.3% of the token holders, in return for paying the conspirators out from the stolen funds.
Holy shit, I can't wait for this latest tech bubble to burst. Really, what has it given us that's beneficial? Social media is all about collecting our private data and using it to advertise to us. Web 2.0 is all about destroying website user interfaces and bloating our browsers with all sorts of useless functionality, much of it which can be used to track us. Mobile devices are also about tracking us. Bitcoin is just a waste of electricity, and an enabler of criminal commerce. Linux has gotten worse thanks to systemd. Windows has gotten worse thanks to the Metro UI, or whatever they're calling it these days. The Rust and Go programming languages are a regression from C++98. Now there's this Ethereum and DAO gibberish, whatever the fuck it actually is, which sounds just about as useless as Bitcoin is.
It's like we were making real technological progress for years, then we hit a brick wall and it all stopped. All we've gotten since is wasteful, useless, invasive crap. I hope this bubble bursts soon, and I hope that the next generation is able to undo the damage that the Millennials/Hipsters have done. Hopefully the youngsters can learn from the mistakes of this most recent bubble.
All the Millenials have ADD. Laugh all you want but that explains all the problems.
This may be the first time I've ever read a Slashdot summary and come away with no fucking idea what's going on. What is Ethereum, some kind of hanger on to Bitcoin? Why are people using it to vote? How long before the DAO is DOA? What?
Pick one...
Maybe it's just me, but when I read the name "Ethereum", the first thing I think of is "delirium".
It reminds me of "Dwolla", which always made me think of "doula".
Then there was "Gowalla", which reminded me of "Dwolla", which reminded me of "doula".
And finally there's "systemd", which makes me think of "dysentery".
DAO
Its a day-eee-ooh
Daylight come and we wan go home
One born every minute.
You are welcome on my lawn.
This is the worst idea ever. Not only is Ether questionably better than Bitcoin, but then the crowd gets to vote on which deals get funded? The crowd is historically behind the times and poorly educated about a real deal, so this sounds like a complete waste of money.
An unbacked "currency" called Ether and so many people taking it seriously?
You mean faster computers that actually power incredible computing pursuits? You know, those that actually run difficult algorithms for science rather than spending most of their CPU time on GUIs and making SQL queries in run-of-the-mill business software that you're probably writing for food.
You mean recent advances in machine learning, including a wide variety of applications in computer vision and natural language processing, more or less due to increased architectural support (improved database systems, distributed computing) and better algorithms?
You mean the considerably less-wasteful Bitcoin alternatives that can actually be better than a large part of the bloated and widely inefficient banking infrastructure?
You mean the abundance of information and knowledge on the internet, coupled with ever increasing capabilities to sift through useless content, and much easier scientific dissemination and collaboration?
You mean Linux that had very specific hardware requirements, but actually gained enough commercial support to get actual drivers?
You mean the better awareness of IP issues and maturing business models that support open source software?
I'm not saying it's a good state that a lot of these businesses rely on advertising and foolish VC money, which IMO are on the decline. But let's not equate advancing technology to running businesses. Looks like somebody just couldn't catch up with the world.
https://en.wikipedia.org/wiki/... aka "There ain't no such thing as a fair election"...
Ethereum is a computing token, not a store of value. ETH tokens are consumed doing computing operations, which allows the running of distributed apps. The actual use-case for ETH is small, since examples are sparse and there hasn't been any rapid uptake from the business community at large.
Enter the Decentralized Autonomous Organization, the DAO. This is a pile of money with zero plan, and the game theory incentivizes you NOT to vote, because then your money isn't locked up into a proposal for an indefinite time period. Combine this with a proof-of-stake kind of voting, and you've recreated the worst parts of the legacy currency system (he who has the most money makes the rules) with the gentle tyranny of a large holder calling the shots.
ETH also has the problem of competing with cost-per-cpu-cycle and cloud-computing resources, where many offerings are very inexpensive and open-source alternatives are abundant. The long-term economic pressure on the "pricing" of ETH is going to be lower, just by the simple fact that there's 80 million units, with ample facility to create more tokens. (And they must be created, after all they are consumed in operations.)
While interesting from a distributed standpoint, there are other simpler ways to spin up a cluster without having to resort to some esoteric token system. In the end, that is ETH's greatest problem, they are trying to solve a "problem" that doesn't exist, ie., there is no central cabal of computing power that prevents someone from creating their own computing clusters, or hooking them all up via the internet.
Yes, you needed to use eth to invest in the DAO. It does not mean you had to invest in the DAO. It's still useful as a cryptocurrency on its own, plus much much more as others have articulated.
Even though the value of eth did drop, it's still higher than it was a month ago. It was lurking around $8-$9 in late April, and now it's over $12 and slowly rising.