What function had the vulnerability?
The split functiion, which allowed theh DAO to be split into a parent and child DAO. The split function allowed users to take their Ether into a new DAO.
Why was the hard fork initiated?
What is DAO?
Distributed Autonomous Organization, which has a decentralised governance through smart contracts.
What function had the vulnerability?
âSplitâ function - allowed the attacker to recursively call the split function and retrieved their funds multiple times before getting to the step where the code would check the balance.
Why was the hard fork initiated?
To rollback the hackerâs transaction and return the stolen funds.
What is DAO?
DOA means Distributed Autonomous Organization; it is a code where set of smart contracts are connected together and function as governance mechanism; the DAO project was a virtual venture capital fund that is governed by the investors of the DAO and the idea was: funds raised from the investors are pooled
What function had the vulnerability?
it was the split function; there was an option to retrieve funds when the minority did not agree with new proposals and did not want to participate; this procedure was hacked (recursive call exploit)
Why was the hard fork initiated?
the hack was too big to let go and the community finally agreed on a hard fork; the motivation was to return stolen funds to the users
A Decentralised Autonomous Organisation (DAO) is a virtual organisation governed by a collection of smart contracts. Participantsâ voting rights are based on the tokens that they own.
The DAO was an infamous project of this kind deployed on the Ethereum blockchain in 2016. Participants received tokens based on the ether they invested. These token holdings determined (i) their entitlement to vote for the projects they wanted the DAOâs pooled funds to be invested in, and also (ii) their share in the returns on these investments. If a minority group of participants disagreed with investment decisions made by the majority, then they had the right to withdraw the ether they had invested and transfer it to a child DAO, which would then operate in exactly the same way as the original DAO, but only with a proportion of the original particpants.
The split function had the vulnerability. After deciding to split the original DAO, and at least a week after the split procedure had been initiated, this was the function that would be called to transfer ether held in the original DAO to the new child DAO.
After much discussion and difference of opinion within the Ethereum community about the best way to respond to the hack and deal with its consequences, and also after plans for a soft fork were aborted, the hard fork was initiated in order to reverse all of the smart contract transactions back to the point in time just before the re-entrancy attack ocurred, and in so doing return the stolen funds to the investors in the original DAO.
DAO is Distributed Autonomous Organization
The vulnerability was in the Recursive call function
The hard fork was initiated to return lost funds from the DAO Hack.
Q1. What is DAO?
DAO is decentralized or distributed autonomous organisation which is a set of connected smart contracts. DAO is governed by voting of investors in the DAO who are issued tokens according to their investments (for e.g. 100 tokens for 1 ether for DAO created by Slock.it).
Q2. What function had the vulnerability?
Split function in the DAO code had the vulnerability. The DAO allowed creation of child DAO if the minority did not agree with the majority proposal. The Child DAO could use the Split function to withdraw their funds from the DAO pool.
The loophole in the split function code was that it allowed to retrieve funds first and then update the balance later. It also did not check for recursive function calls to retrieve funds. This vulnerability enabled attacker to recursively retrieve funds before the balance could be updated.
Q3. Why was the hard fork initiated?
Initially the ethereum community voted for soft fork to eliminate the child DAO and making its transactions invalid. However the move was discarded as it posed further security flaws.
Majority of the ethereum community agreed that something must be done to recover lost funds and returned to the investors. This resulted in hard fork on the ethereum blockchain.
Decentralized Autonomous Organization is a computer code through which a set of smart contracts are connected together and function as a governance mechanism.
Split()
After attack, to refund the money to the victims
DAO is another computer code through which a set of smart contracts are connected together and function as a governance mechanism.
split function
It was initiated to restore funds to their owners.
What is DAO?
Decentralized autonomous organization.
What function had the vulnerability?
splitDAO() function.
Why was the hard fork initiated?
Because the soft-fork had DOS risks associated with it and the majority of the Ethereum community then voted for the hard-fork to get the lost ETH back.
1. What is DAO?
DAO stand for distributed autonomous organizations and is another computer code through which a set of smart contracts are connected together and function as a governance mechanism distributed autonomous organizations. The idea of the DOA from Slock.it was, that funds raised from the investors (i.e. the token holders) are pooled. Token holders can become contractors by submitting proposals for funding of their project by using the DAO funds. Any Ether generated from the proposals funded by the DAO would be returned to participating investors as rewards.
2. What function had the vulnerability?
The infamous split function had the vulnerability. The attacker(s) managed to recursively call the split function and retrieved their funds multiple times before getting to the step where the code would check the balance.
3. Why was the hard fork initiated?
On 22 June, a voting started on biggest mining pools regarding a response to the hack. First the majority agreed on a soft-fork, but due to additional security flaws it would pose this solution was discarded. Then they proposed a hard fork, which then was voted and accepted by majority of the Ethereum community. The Ethereum hard fork did not prevent all participants from following the old main branch, so the old branch continued to run and was then renamed âEthereum Classicâ as the original name âEthereumâ was adopted by the majority of participants for the new branch.
What is DAO?
The DAO is a smart contract on ethereum at the beginning of the Ethereum network. It was a decentralized organisation with a decentralized governance enabled by the smart contract.
What function had the vulnerability?
The function was a split procedure which enabled users to migrate their tokens to another DAO contract. The split function had a callback, which was a function called on the child contract. The state (the balance) of the DAO contract was only altered after the callback. This callback was thus making a loop, basically calling itself, each time transfering funds, thus draining the ethers locked in the contract.
Why was the hard fork initiated?
Because it was concluded that human intervention was necessary. The fork was basically a huge undo button triggered by the nodes.
