Applications based on Blockchain networks, as well as cryptocurrencies such as Bitcoin, Ethereum or Litecoin are getting closer and closer to our lives. The rise of cryptocurrencies is self-evident.
Added to the emergence of new cryptocurrencies, the interest of other industries in adopting the use of blockchain made this technology more complex, increasing the margin of error due to the demand for a more complex development. The article exemplifies this phenomenon by citing the case of Zcash, a cryptocurrency that uses a complex mathematical process to allow users to carry out transactions in private and that publicly revealed that they had to repair a cryptographic flaw in the protocol that, had been exploited by a attacker, could have allowed to create unlimited fake Zcash.
Blockchain technology is also used for smart contracts. A smart contract is a computer program that runs on a blockchain network and can be used to exchange currency, property, or anything of value. According to the MIT article, another use that can be given to smart contracts is to create a voting mechanism through which all investors in a venture capital fund can decide how to distribute the money.
A fund of these characteristics that was created in 2016 under the name of The Dao and uses the Ethereum blockchain system, was the victim of a computer attack in which cybercriminals stole more than 60 million dollars in cryptocurrencies by exploiting a flaw in a smart contract managed by this organization.
This attack made it clear that an error in an active smart contract can have critical consequences, since relying on the blockchain cannot be repaired with a patch. In this sense, smart contracts can be updated, but cannot be rewritten, explains the article. For example, new contracts can be created that interact with other contracts or centralized kill switches can be created in a network to stop activity once the attack is detected, although it may be late.
Check also:
The Dangers of Cryptojacking and how it affects users
What you should know about Crypto mining
