DAO vulnerability -- Ethereum

Yesterday someone exploited the so called “DAO vulnerability” to steal some 3 Mio. Ether. This incidence, of course, led to a panic attack by many people trading Ether, which resulted in Ether prices plummeting. This article by The Verge even titled “How an experimental cryptocurrency lost (and found) $53 million”. So here is the catch: the author of this article, and in the same vein everyone else already summoning the death of the “Ethereum cryptocurrency”, actually miss the point about Ethereum. Ethereum is not a cryptocurrency, but “… a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third party interference.” _The execution of these smart contracts is fueled by _Ether , but Ether is not a cryptocurrency, like bitcoin. It was never thought to be yet-another cryptocurrency. So don’t blame the project, if you lost “real” money yesterday. Ether is not there to be traded in the first place, it’s a commodity, to be used in the Ethereum network. And to be sure: Buterin nicely explains that the attack is not a bug in Ethereum itself, but a mistake in the code powering the DAO project. As it seems, a common bug, though.

So, what will happen? Well, I think the Ethereum community learned a valuable lesson. The attack might foster the creation of long-awaited “best-practices” for smart-contracts, maybe even projects to “security check” your own smart-contract code. Learning the hard way is often the only way to learn. In this sense: no, the project certainly is not dead – quite the opposite, it might never have been more alive.