Topic: The DAO FAIL - page 2. (Read 20444 times)

I don't think this is a bad thing in itself.  Most of this market cap is first of all just a speculative bubble because the price is not really the price of "money" (the bitcoin and other coin USAGE as a means of exchange doesn't justify such a market cap) and is also not really the price of "store of value" (most bitcoin holders don't hold bitcoin as "store of value" - that is, to get out about the SAME value years later, but to get out MUCH MORE value without there being an equivalent production of value standing over it - so most of bitcoin's market cap at this moment is still coming from "greater fools" theory rather than "same value").

By this I do not mean that bitcoin's price will crash.  Absolutely not.  It might well be that bitcoin gets used one day are genuine money and that its monetary market cap will even be higher, but for the moment, the market cap is essentially speculation and doesn't come from the normal monetary value it should have as a means of exchange.

So if this market cap lowers a lot due to what happened to the DAO it won't hurt bitcoin as a means of payment (it has largely enough market cap remaining to do all the purchasing of goods and services one is doing with it right now, which isn't a lot).

On the other hand, a wake-up call was necessary.  It is necessary to see what happens when the block chain paradigm fails, such as happened to ethereum, and when a chain forks genuinely.   That such a block chain failure would occur one day now seems obvious (after the fact) and it is good to be aware of it, also for bitcoin.

That a few billion of hot air speculation got burned doing so is not so much of a problem I'd say.  Crypto is testing its limits, its behavioral features, and we need to know more about that before going further.

Also, my personal hope is that one will wake up about this monumental problem in bitcoin, which is traceability and the potential colouring of coins, as ethereum is now also experiencing.

Keep in mind that not only the DAO got hurt, but the entire market. Before the attack, market cap of the cryptocurrencies was about $14.2Bn and it was shrinked to ~$12.5Bn in a ~week. Bitcoin was at its peak since the beginning of 2014. Look what I've said 2 days before the attack:


... and what Hueristic answered:


I believe its safe to say that the DAO failure caused a few hundred million $ (quite possible to be even over a billion $) in losses. Its not like I'm bragging or anything, but I was expecting this to happen and it was the main reason to start this thread. Projects are coming and going all the time, but when it comes to a project with such funds, then we should all worry about on what may happen in future.

As if it can be expected that complex code will not contain a bug or an exploit.  That was the first failure but it is a *fundamental* failure: one cannot write complex software from scratch, without having it used, and the guarantee that no bug or exploit will exist.
Normal software gets around this, by updates, when bugs or exploits are detected.  But, by definition, smart contracts cannot be updated because they are a contract which has, of course, to remain in place as it was originally convened (unless you make the update part of the contract, which opens even more the Pandora's box of potential bugs and exploits).

The principle of complex, Turing complete, bug free and exploit free smart contracts from the start, unstoppable and unalterable, is an oxymoron.

Moreover, the *economic function* of the DAO was ridiculous, as I posted earlier.  There's nothing the DAO could economically accomplish which simple crowd funding cannot accomplish.   It just got vastly more complicated, where some privileged got more to say about other people's money.

I really wonder what was the sense of this experiment, of which the disastrous outcome was evidently predictable.  Did one really need to mess with $150 million to find out the obvious ?

That was not intended as a joke. It was a good experiment. But it failed due to a bug in the software implementation.

Personally, I think DAO is a joke, from a certain point of view, it personally split the ETH, the emergence of ETH and ETC

It was a sham from the very beginning. Many known people in the cryptosphere like GMaxwell, Peter Todd and Adam Back have already said that Ethereum will never become a viable platform for smart contracts. I do not think Vitalik is trying to scam the people but he should know deep inside that Ethereum as a platform will not work as promised. He is selling what is called "snake oil".

I hope developers who know will add to the conversation and explain in layman terms why Ethereum is not viable.

i doubt that anyone can deal with it to be honest we cannot do anything about the dao and i hope there wont be any of such cases in the future

You're both wrong.



The price of Ethereum was over 2.76m satoshi (i.e. $21 at the time) and its currently well under 2m satoshi. I think that Bitcoin also suffered from the DAO attack, because it lost more than half a billion $ from its market cap in a matter of hours.

I do not think so. The price of ETH should be around $15 if it is fully recovered from the DAO hack. The price is just below $12 now.

I was somewhat blinded too, but I think now that, looking back, the DAO was a very, very stupid idea.  After all, what was it ?  It was "making a pot of money" for "VC investment", and then having the contributors vote on where to put the money.  But that is ridiculous.  If you can vote proportionally to your contribution to where the money should go, *then put your money directly there* !  Simple crowdfunding of all the proposals would have been good enough.  No DAO needed.  You like it ?  Put your money in it.  You don't like it ?  Don't put your money in there.  How can it get simpler ?  What does the DAO bring in that simple crowdfunding doesn't ?  Apart from bringing in middle men, profiteers, "developers" and other parasites which crypto was designed to get rid off ?
The DAO was nothing else but a confusing way to do crowdfunding, with the possibility of using other people's money to a certain extend and with funny mechanisms to make "no voting" expensive.  There was not the slightest bit of economic rationale behind the DAO.  The same people who put money in the pot, vote for where the money should go.   Usually people vote DIRECTLY with their money, OR they trust an institutional investor to do it in their name.  But putting it in a pot to vote oneself for it, is totally ridiculous.

The other thing is of course the Turing completeness, which is an utterly bad idea (but which sounded good in the beginning).

So there was *NOTHING* that was a good concept in the DAO.  It was an economically ridiculous idea on a ridiculous platform.  It didn't solve any slightest bit of problem.  

I think the Ethereum price has already recovered from the DAO hack. The price is quite stable at around 0.0195 now.

i dont undersatand it dao etc ...

It is difficult to say how long does it take for the Ethereum to recover from the DAO hack. In terms of price, it will take 6 months.

i think eth need one more year to recover from what DAO caused . 

I think so. The Ethereum is just one year old. It will make more mistakes in the future, we have to be tolerant.

The DAO is a good concept. It is still in the early stage of developments. So there will be some growth pains.

Well he did say other Devs. A decentralized autonomous organization is still a good concept in theory, it was just hacked. 

I do like altcoins in general if they come up with new ideas and new systems, because bitcoin, being the first, is also one of the poorest in ideas, but bitcoin is now too big and too conservative to try new things quickly.  So altcoins to explore and research are a good idea ; altcoins to scam and pump/dump not.  Sometimes it is hard to make the difference, but nevertheless, several altcoins have come up with really potentially good ideas.  That said, potentially good ideas sometimes turn out to be, after all, extremely stupid.  That's the nature of new ideas: they seem good in the beginning, but only a few turn out to be actually really good.

Ethereum is one of these altcoins, which proposed complex smart contracts.  I was initially quite enthusiastic about it ; I needed myself to witness the DAO fail to understand the fundamental failure: Turing Completeness.  Turing completeness is of course a great property of general purpose computing: you can write a piece of software for just any problem.   So it seemed like a good idea to use a Turing Complete language to write smart contracts in, much "richer" than the bitcoin scripting language which was, on purpose, not Turing complete.  As I said, it took the DAO failure for me to realize the stupidity of this initially seemingly brilliant idea.

Contracts are not just pieces of software.  They are supposed to be judges.  No law system is ever Turing Complete, because every law system needs to guarantee that it will come to a decision.

Once you realize that, but I had been blinded by ethereum's enthusiasm too, you realize the utter stupidity of ethereum.

This cannot be anything else but disaster area.  Writing contracts of which their execution is unverifiable, other than to run them, is a mightily crazy idea if you think about it.   It sounded brilliant, it was in fact tremendously stupid.  But it was so sexy that it took a thing like the DAO fail to demonstrate it.

So, what's there left for ethereum ?   I don't see much, actually.  One should limit one-self to such a small subset of Solidity that it can be automatically verified, and that all branchings of its execution can be examined, not by running it, but by analysing the code, that in fact, it will be reduced to not much more than the bitcoin scripting language.

In other words, if a contract on ethereum is "safe", it can also be run on bitcoin, and if you use fancy stuff from ethereum that is hard or impossible to do in bitcoin, you are open to DAO-like disasters.  No matter how much auditing.  You will NEVER BE SURE AGAIN.

As long as idiots buy into premine ico scams this will never happen (with minor exceptions that get lost in the noise and are seriously underfunded). The greedy sheep support this shit and don't listen to warnings or learn which becomes a cycle of ever growing proportions that put them into a position where they have to jump on the next shitcoin train to recoup from the last and pull in new fools to buy that bag of shit. The entire Alt scene is one big pyramid with a few notable exceptions. The bag holders of one shitfest get to the next level of the next shitfest (if they don't cut their losses) and slowly work up the chain to break even if they stay long enough and then become part of the spoon feeding shit shoveling themselves and see profit. It's a training ground for bottom feeding fools no different than jail creating better criminals.


Your posts are spot on but you are trying to point out logic to a shill that ignores logic when it doesn't support his shitcoin bag.

This is his handbook.

https://web.cn.edu/kwheeler/fallacies_list.html



They will never learn anything if they are allowed to bail themselves out, it's no different than the bankers we all detest and the reason CC exists. Fucking Hypocrites.

Those of us that try to warn the n00bs get tired of wasting our energy and experience on ungrateful turds. I've been warning of scams for years and haven't received one thank you. I dropped in every Bob surplus scam and warned people and I don't think one fool listened but they all cried when fleeced and Bob had a real good laugh. It gets to the point where you feel they deserve to get fleeced.

well yeah but it didnt destroy the ethereum, in my opinion ethereum will still have a pretty decent possibility to grow at a very rapid pace