Hey guys, xCache here.
So as most of us know, the crypto-currency Ethereum, arguably second largest coin in the crypto scene, had a open-source token-based platform running on the Ethereum Blockchain.
This platform is called The DAO.
The DAO stands for Decentralized Autonomous Organization, where you could invest in startups and back proposals to add new things to the DAO code, by voting with your tokens.
The DAO, in order to get people tokens to vote and invest with, had a beginning crowd-sale, where you could exchange Ether for these tradable tokens, at a rate starting at 100 DAO tokens to 1 Ether. This rate increased as it progressed to the date of it's launch. This entire event raised over 140M USD in ETH, 11.5M ETH in total, and attracted nearly 14% of all ether issued to this date.
However, things took a turn for the worst, when a 'hack' took advantage of multiple vulnerabilities in the DAO code, allowing for a 'hacker' to move 3.6M ETH, worth around 50M and a third of all the ETH invested in the DAO, into an account with a 28 day holding period. Investors and ethereum users alike both discussed what should be done.
Some people talked about letting it stay, as people called it a "valid, but unethical maneuver", as it was not hacked, but merely vulnerabilities were abused in order for this 'attack to happen.
Other people wanted the ETH re-appropriated, and some people wanted to shut down the entire organization completely.
The Ethereum organization decided to hard-fork, or make 'a permanent divergence in the the block chain, (which) commonly occurs when non-upgraded nodes can’t validate blocks created by upgraded nodes that follow newer consensus rules.' (https://bitcoin.org/en/glossary/hard-fork)
This hard-fork meant that original owners of the stolen DAO could take and withdraw their DAO from the address, and the rest of the un-claimed DAO would go to be split among the curators of the DAO.
This all happened at 14:30 UTC, July 20th. more here. (http://www.coindesk.com/ethereum-executes-blockchain-hard-fork-return-dao-investor-funds/)
After they mined the 192,000th block, the pool mined the first block on the new blockchain, which meant that all the users who had their DAO stolen had their DAO safe in an account available to them.
Above is what the price did during and after the hard-fork!
People are now super positive and optimistic about ETH, and DAO is moving up right alongside it!
One of those people, Ethereum co-founder, Taylor Gerring says that the "hard-fork will make the network more resilient." (https://cointelegraph.com/news/ethereum-co-founder-taylor-gerring-hard-fork-will-make-network-more-resilient)
Vitalik Buterin, ETH co-founder, was talking about it in a blog post:
"Block 1920000 contained the execution of an irregular state change which transferred ~12 million ETH from the “Dark DAO” and “White-hat DAO” contracts into the WithdrawDAO recovery contract. The fork itself took place smoothly, with roughly 85% of miners mining on the fork...
The recovery contract is already returning DAO token holders’ ether; about 4.5 million ETH has been sent to DAO token holders, and about 463000 ETH is in the control of the curator; a contract to facilitate extra balance payments is currently undergoing security review." (https://cointelegraph.com/news/ethereum-hard-fork-goes-smoothly-its-market-value-back-to-1-bln)
The market value of ETH has returned to $1 billion, and people are bullish. :)
Go ETH!
Thanks for reading my first, short, little report on Ethereum and the DAO hard-fork situation. I hope to be pushing out more work like this in the short future.
Feel free to discuss below, and comments and constructive criticisms are appreciated :)
Thanks for your time.
Solid article detailing what occur during the last few weeks.
Thank you, I will be trying to push out more content like this in the next couple of days. You have any topics I could talk about on here?