Why The DAO Attack is Good for Ethereum
Mattew Spoke is the co-founder and CEO of blockchain startup Nuco, and is a former project lead for Deloitte Canada where he worked on blockchain and distributed ledger initiatives.
In this op-ed, Spoke argues that this week's exploit of the Ethereum-based organization The DAO is, in the long-term, a good thing for the Ethereum project.
Yesterday was a whirlwind for anybody working or invested in the ethereum world.
Understandably, the day’s attack on The DAO has led to criticism, skepticism and concern about the future of Ethereum. But is there really a cause for concern? Of course, with millions of dollars worth of the cryptocurrency ether invested in The DAO (as of the writing of this), it’s no surprise that the attack is making headlines, and mostly negative ones at that.
That said, I think it’s important to view today’s events as an important case study in the anti-fragility of new digital technologies, that will only lead to more security and diligence as ethereum evolves.
As popularized by the renowned author Nassim Taleb, the concept of anti-fragility can be summarized by a simple quote from his book, "Antifragile": "The resilient resists shocks and stays the same; the anti-fragile gets better".
This is the only way to properly characterize ethereum, and any other technologies evolving in the blockchain world, including bitcoin. Basically, a negative event, like the one occurring as we speak, will ultimately lead to a stronger ecosystem and more secure technology.
Some comparison has been made today to whether The DAO will become the "Mt Gox of ethereum". I don’t reject the implication. If we learned anything from the disaster of Mt Gox, it’s that subsequent exchanges were built with more care, more diligence and significantly more scrutiny – all good things.
Although I don’t expect that my prediction carries much weight, I’ll offer it anyway: the DAO attack will likely be reversed, as per Vitalik’s proposal; owners of TDT (DAO tokens) will be able to retrieve their ETH after the proposed hard fork; The DAO will be emptied of its investments; and future distributed autonomous organizations will learn from the lessons.
Ethereum is here to stay, and today, it just got stronger.
Daisies image via Shutterstock
Disclaimer: The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, CoinDesk.