The Ethereum blockchain was able to take part in The DAO project initiative funded by blockchain users.
Definition of the notion of Decentralized Autonomous Organization or DAO
The Ethereum blockchain was able to take part in The DAO project initiative funded by blockchain users.
This notion designates in English Decentralized Autonomous Organization (or decentralized autonomous organization).
DAOs refer to organizations aimed at mitigating the vulnerability of code and thus smart contracts on a blockchain.
Indeed, this can play a key role in reassuring potential investors about the diversity of existing blockchains.
The challenge is therefore to enhance certain conformity on the blockchain and thus try to bring a secure status to the smart contract.
This DAO was however finally hacked on June 17, 2016 and the cryptocurrency experienced considerable danger.
According to Ethereum, this event is "an earthquake in the Ethereum ecosystem: more than a financial loss, it is above all a profound disappointment and a collective knowledge of the enormous attack surface of Ethereum."
The legitimate question to ask is ultimately how to ensure better security after such events. How to ensure, more generally, the security of a smart contract?
The smart contract security audit procedure
Ethereum is far from being the only blockchain to be scrutinized by Internet users and investors, but since its merger allowing it to develop its method, some have highlighted the potential past security risks, as previously stated, but also those to come.
If The DAO was the victim of a hacker attack in 2016, the same event is repeated five years later, which only reinforces this desire to assess the vulnerabilities of an investment on Ethereum but also of the smart contract in it more broadly.
Indeed, the smart contract remains, as its name indicates, the element allowing any contractualization.
The analysis of protocols and movements on a blockchain can thus go through a procedure called an Ethereum smart contract audit.
A technical subject matter expert will review the code.
Indeed, simple small errors in the code allow the escape of colossal sums.
This procedure makes it possible to draw up an assessment, a report of the search for faults is carried out.
The main stage of the procedure consists in carrying out several tests in order to report on the degree of possibility of the occurrence of security breaches.
But the question that arises is whether these audits are able to predict any type of attack.
The technology associated with the blockchain is continually seeking refinement and improvement, but the attacks are also becoming more robust.
The development of smart contract audit companies
Many companies are developing in this way with the mission of auditing these famous smart contracts.
In Europe, examples of structures are in Germany with for example SolidProof and Chainsulting.
In France, some traditional audit firms are taking up the subject and are also developing technological solutions to question the security of a blockchain.
These solutions thus open up the possibility of auditing the security of several cryptocurrencies, among which we find ether but also others such as bitcoin or Ripple.
The choice of the actor to be favored is therefore a step that should not be underestimated in the context of a verification of the security of a smart contract.
We therefore recommend always giving the greatest importance to the risk mapping stage of any project implementing contractual support such as the smart contract.
