Parity Tech has ‘no intention of splitting Ethereum’ over 513,000 stranded ETH » Brave New Coin

The ongoing debate over EIP-999 is one step closer to resolution. On Thursday, Parity Technologies issued a statement saying they have no plans to move forward with the improvement proposal that would result in an Ethereum blockchain split.

The proposed code change would recover the 513,000 Ethereum that were rendered unspendable by a bug in one of the company’s smart contract libraries last November.

The statement, released on the Parity website, emphasizes that the company has no intention of splitting the Ethereum chain, saying:

“Let us make clear: we have no intention to split the Ethereum chain. We plan to continue to work with the community to find a path forward. We have all dedicated a great deal of time and effort to developing the Ethereum ecosystem, and have no intention of harming what we have helped build.”

The EIP-999 dispute

Disagreement over whether or not the chain should split to restore lost funds has provoked fierce debate, raising issues of immutability and moral hazard, and uncovering an existential angst that has not been seen since the DAO fork of July 2016 — which restored hacked funds to the tune of $50 million.

EIP-999 supporters argue that the funds should be recovered regardless of the effect on network reputation, but those against the proposal warn that forking could create an ‘evil twin’ that would jeopardise the entire Ethereum network.

A rigged vote?

In order to gauge community sentiment, a poll was posted on Ethereum block explorer Etherchain that allowed users to vote by signing a message with their wallets.

Votes were then weighted by the amount of funds each voter possessed, and the results showed a tight debate—with only a slim majority against the fork.

However, the poll attracted widespread criticism on Twitter, with commenters slamming the fact that it could be “easily gamed by people moving coins”, and that people were unlikely to take funds out of cold storage to participate.

Redditors were also rankled, and user x_ETHeREAL_x pointed out that the poll allowed victims of the hack to use funds stored in the affected multisig wallets to support their vote. This includes the wallet of Polkadot, owned by Parity founder Gavin Wood, that holds more than 306,000 ETH.

As the results of the poll were dissected, Vitalik Buterin chimed in on Twitter to suggest that the narrative spun by major crypto news sources was sensationalist, and presented the fork as far  more likely to be accepted than it actually was.

A bug in the smart contract

The bug, which affected nearly 600 different Ethereum wallets, led to losses of around $150 million in Ethereum—an amount that doesn’t include the ERC-20 tokens that were also present.

GitHub user “devops199” claims to have accidentally exploited the smart contract bug in November 2017. The bug allowed him to declare ownership of the contract library and caused affected wallets to self-destruct—rendering them instantly inaccessible.

In response, EIP-999 was drafted by Parity employee Afri Schoedon. It proposed to rectify the situation by reinstating a disabled contract that would unfreeze the affected wallets and restore funds. Schoedon wrote on GitHub:

“This proposal is necessary because the Ethereum protocol does not allow the restoration of self-destructed contracts and there is no other simple way to enable the affected users and companies regaining access to their tokens and Ether,”

As the Ethereum protocol does not permit the reinstatement of self-destructed contracts, a hard fork would be necessary. The next hard fork planned, known as Constantinople, is part of the transition towards Casper, Ethereum’s initiative to switch consensus algorithm from proof-of-work (PoW) to hybrid proof-of-work (PoW) / proof-of-stake (PoS).

The fork will happen regardless of EIP-999. But Schoeden proposed that EIP 999 should be added to the list of EIPs to be implemented during the fork.

Doing so, however, carries the risk that the Ethereum contract would continue to exist on both chains, potentially leading to a split in the community and a loss of overall value in Ethereum.

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