Regarding the recent “attack” on the Etherum DAO project where approximately 3.5 million ether was drained from the system most commentators are saying this was fraud.
Another angle could be that this was a smart trader who injected code to take advantage of a potential design loophole?
I am of an age to remember ERM and George Soros.
For younger readers, the British government had joined the European Exchange Rate Mechanism (ERM) as part of their effort around the unification of the European economies. The mechanism allowed the pound to shadow the German mark (which was the core currency of the ERM) in the period leading up to the 1990s with the expressed desire to keep its currency above 2.7 marks to the pound.
The similarities are that speculators (the most famous being Mr Soros) recognised a fundamental flaw, namely that Britain’s inflation rate was many times that of Germany and that fixed exchange rates were vulnerable to market forces. Mr Soros shorted the currency and eventually Britain had to give in and withdrew from the ERM as it became clear that it was losing billions trying to buoy its currency artificially.
Mr Soros made $1billion from the deal. Have we seen our first George Soros on a blockchain exchange?
So what are the lessons if we are thinking about enterprise ready blockchain
1. Security is the DNA of the platform and is woven into each component.
2. Statements of authorisation are the building blocks not injectable code.
3. Co-existence between private and public chains