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Digital Currency Ethereum Is Cratering Amid Claims Of a $50 Million Hack (businessinsider.com)

Posted by msmash on from the security-woes dept.

Digital currency Ethereum's value has dropped amid a hack on DAO (Decentralised Autonomous Organisation), an organisation with huge holdings of Ethereum (Wikipedia page). Its value is now below $15, down from more than $21 a few minutes ago. It is believed that as much as $50 million of the digital currency has been stolen. From a blog post on DAO: An attack has been found and exploited in the DAO, and the attacker is currently in the process of draining the ether contained in the DAO into a child DAO. The attack is a recursive calling vulnerability, where an attacker called the "split" function, and then calls the split function recursively inside of the split, thereby collecting ether many times over in a single transaction.From a Quartz report: It's no surprise that cryptocurrency markets are in a panic. Funds invested in the DAO represents more than 10% of all the ether in circulation ($81.8 million worth). A massive hack on the DAO's holdings would be roughly equivalent to a successful heist at a major financial institution.

3 of 116 comments (clear)

  1. A successful heist? by jtownatpunk.net · · Score: 3, Insightful

    Doesn't sound very successful if the thing you're stealing becomes worthless because you successfully stole it. Unless you have significant holdings in other crypto-currencies which will increase in value due to their better security.

  2. Maybe I'm showing my age but... by bazmail · · Score: 3, Insightful
    ...that is all complete fucking jibberish.

    An attack has been found and exploited in the DAO, and the attacker is currently in the process of draining the ether contained in the DAO into a child DAO. The attack is a recursive calling vulnerability, where an attacker called the "split" function, and then calls the split function recursively inside of the split, thereby collecting ether many times over in a single transaction.

  3. Federal Reserve by captaindomon · · Score: 4, Insightful

    Except if this happened at a "major financial institution", the Federal Reserve would step in and stop a panic by insuring the funds. That's why we *have* a federal reserve. See the Panic of 1907 for an example.

    --
    Just because I can hook a shark from a boat, I do no offer to wrestle it in the water.