By Amy Castor for BTC Manager (originally published on 10/17/16)
So, it looks like Ethereum is about to undergo a two-staged hard fork.
But unlike the network’s earlier hard fork, meant to head off the DAO hacker, this time the fork is to secure the network.
Since late September, the Ethereum network has been hit by a number of denial-of-service (DoS) attacks. Although the attacks haven’t caused any consensus problems, they’ve slowed down the network considerably, forcing the Ethereum Foundation to execute a hard fork.
What’s Caused the Security Break?
One of the problems was that the attacker was able to easily and inexpensively, at a very low “gas” price, set up fake smart contracts and use those to repeatedly spam the network.
Gas is Ethereum’s internal pricing for running a transaction or a smart contract.
Inside the Ethereum network, the attacker has a server repeatedly compute the same process over and over again, slowing down legitimate mining operations. In this case, attack transactions are calling an opcode called “EXTCODESIZE” about 50,000 times per block.
Ethereum tried implementing a series of patches to solve the problem, but stronger action is needed. The hard fork aims to make it a lot more expensive to do the attacks.
In the official Ethereum blog, Martin Swende, security lead at Ethereum, wrote:
“While the recent patches have led to an overall increased resiliency in the client implementations, the attacks have also demonstrated that a lower-level change to the EVM pricing model is needed.”
EVM stands for Ethereum virtual machine, which is where smart contracts are run.
According to Swende, the first hard fork is to increase the gas price “to correspond better to the underlying computational complexity.” This will be followed by a second fork aimed at reducing “state-bloat” by removing null accounts introduced by the attackers.
The first hard fork will take place on October 18 and the second will take place on October 25.
Ethereum Classic to Hard Fork as well
Of course, since Ethereum Classic shares the same chain as Ethereum, it is not surprising that Ethereum Classic also has been experiencing similar attacks. In response, the Ethereum Classic network will do a single fork starting at block 2,500,000 on October 25.
Because the whole point of Ethereum Classic was to establish the principles of immutability on the blockchain, ETC has gotten some flack for doing a fork.
But apparently, whether all forks are equal or not is up for debate. The Ethereum Classic community contends that forks that strengthen the network are okay, while those that reverse transactions, like in the instance of the DAO, are not okay.
Carlo Vicari, the community manager for Ethereum Classic wrote on Reddit, “This protocol improvement is very much aligned with our principles of immutability.”
Why Would Someone Attack Ethereum?
It is likely that the attacks are an effort to make money by shorting the markets. Because when the attacks happened, the price of Ether went down.
Vicaro told BTCManager:
“I think the reason we were not being attacked originally is because the attacker is making money with these attacks by opening up short positions in the markets. When the attack goes through and the price of Ethereum goes down, he makes money.”
Vicaro put a positive spin on the events, stating that when a chain is attacked and that attack is repelled, it makes the chain stronger in the long run.
“It is better to have these attacks happen now and defend against them then years down the line when we have a lot of different things going on and different decentralized apps running. To have an attack like this then would be a real catastrophe.”