Nomad drained of $150m due to a coding mistake

Re:Nomad drained of $150m due to a coding mistake by DennisP on Tuesday August 02, 2022 @11:47AM (#32320172)

Ethereum's PoS has been running since December 2020. Right now about 10% of all ETH is deposited on it. What's coming up is the "merge", where the rest of the chain starts looking at the PoS network for choosing blocks, instead of looking at mining difficulty.

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Re:Nomad drained of $150m due to a coding mistake by latchkey on Tuesday August 02, 2022 @11:59AM (#32320385)

> Right now about 10% of all ETH is deposited on it.

Nope. The ETH is just in a rather simple write only deposit contract on ETH1. [1] It is also not 'all' ETH, since there is no hard cap on the total amount of ETH in existence.

It is also a bit more complicated than just looking at the beacon chain. That beacon chain has zero value tied to it. So while it has been running just fine, there hasn't been a reason to attack it. It also hasn't been used to actually do anything really... and now there is a use. There is also a lot more communication going on between nodes that didn't exist before. All of these things become attack surfaces.

[1] https://etherscan.io/address/0x00000000219ab540356cbb839cbe0...

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Re:Nomad drained of $150m due to a coding mistake by DennisP on Tuesday August 02, 2022 @03:32PM (#32323229)

That's an...interesting view. Let's skip the semantics and stick to facts, which are these:

- 10% of the current supply of ETH is in the deposit contract, and can't be withdrawn from the deposit contract.

- Every address that deposited ETH into that contract got a corresponding balance of "ETH" on the beacon chain. (I'll call it "ETH" instead of just ETH to avoid arguing over whether it's really ETH.)

- The beacon chain is functioning as designed, and the "ETH" balances of various addresses are getting changed over time. The economic incentives appear to be working. People are keeping their nodes up and running to get rewards, and trying to avoid getting slashed.

- The plan is for stakers to be able to withdraw their balances to the main chain, from the beacon chain. When someone withdraws, an ETH balance will be incremented on the main chain, and the same address will get its "ETH" decremented on the beacon chain.

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Re:Nomad drained of $150m due to a coding mistake by latchkey on Tuesday August 02, 2022 @03:49PM (#32323423)

Cool, facts. Let's keep going.

Right now, the contract is one way and there is no way to withdraw. The code hasn't been developed yet. The ETH or "ETH" or whatever, are secure because there literally cannot be insecurity without some code to break.

Heck, even "The Merge" doesn't enable withdraw... it is scheduled for some time after (still to be decided and coded... more potential security issues) and is of course a slow trickle too (first people who can withdraw win the short market). That 10% is about as secure as you can possibly be in that it is effectively burned at this point and will require yet another hard fork to unburn it.

Let's go back to the premise of my original comment:

PoS is a lot more complicated than PoW and offers a much wider attack surface.

Any large mistake in the code that causes financial loss is going to go down a huge rabbit hole of how to manage consensus around fork choices and will likely have at least a short term devastating effect on the market.

I want to see PoS succeed, but as a 20+ year developer, I'm very skeptical it will go off without a hitch.

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