Blockchain technology and its multiple advantages have made things easier and quicker for the technologically advanced 21st century. However, a single fault or error in this advanced technology can have devastating consequences. The Ethereum hack of 2017 is a coding error that headed to the theft for 30 million dollars worth of ether. In fact, matters could have been much worse as an additional 75 million dollars worth of ether could have been stolen. However, some ‘white hat’ hackers were successful in rescuing these funds.
Ether token is a digital currency that is similar to bitcoin. In 2017, due to a minor coding error, approximately 153,000 ether tokens were stolen from the ether wallets of at least three projects that had completed their ICOs or initial coin offerings. Amongst these, 44,055 ether tokens were stolen from Swarm City, an e-commerce digital platform. The other two projects that became victims were Edgeless Casino and Aeternity. Aeternity had suffered a theft of around 82,000 ether coins. There was a staggering fall in the value of ether coins from $235 to $196 once this Ethereum hack came into public view. Although the value of ether coin has since improved to $213, it has failed to achieve its initial prime value.
Parity, a software developer had explained the source of this goliath Ethereum hack. Parity’s web browser is basically integrated with the Ethereum blockchain and users can store their funds in its wallet. The wallet is based on a skeleton of multi-signature technology that is highly secure and allows safe and reliable transactions of digital currencies. The Ethereum hack of 2017 was a direct result of an error in the multi-signature technology of Parity’s wallet. It was a highly embarrassing error wherein just a single word was missing and that led to a catastrophic effect. As soon as Parity became aware of the error, they had requested users to shift their funds somewhere else from the wallet. According to a report given by Parity’s founder Gavin Wood, a group of ‘white hat’ hackers was successful in saving over 377,000 Ethereum coins from being stolen. The Ethereum hack had a serious impact on the value of the ether coins and the market is still trying to recover from it. Programmers and Ethereum wallet users need to be careful and the same applies to the users of any other digital currency.