Some time ago, Vitalik Buterin participated in Eric Weinstein's podcast in which he revealed some of his life's details. He talked about, among others, holding the position of reporter in Bitcoin Magazine and about launching Ethereum. Not everything was as colorful as it might seem.
Vitalik Buterin about The DAO
At a certain point during the interview, the conversation centered closely around DAO, a decentralized autonomous organization. It was not a superficial presentation of the subject, however, as Vitalik Buterin focused on The DAO, which created the band Slock.IT in 2016. In fact, it is not known what it really was that made the creators of this project give it such a name. The desire to become recognizable, perhaps... It should be noted here, that many people simply do not distinguish between DAO and The DAO. For this reason, The DAO's infamy has affected all decentralized autonomous organizations.
This program was to serve as a replacement for centralized companies.
- explains Vitalik Buterin.
The DAO was a kind of decentralized venture capital fund which allowed voting on projects worth investing in. The organization has accumulated almost 13 million in ETH (12.7 million ETH to be precise), an equivalent of $150 million. It should be added that the organization has become the largest crowdfunder in history.
Hacking attack and hard-fork Ethereum
Not everything was perfect in The DAO, though. The blank in the code enabled the hacker to derive 3.6 million ETH, that is $70 million at the time, from it.
Vitalik Buterin started to worry that a negative incident like that could harm Ethereum even after the collection exceeded $50 million. What happened on the 17th of June, 2016, shook him hard. Blockchain spamming became a remedial tactic then, in order to somehow slow down the attacker. The stolen Ether did not go straight to the attacker's wallet, instead it was trapped in an intelligent contract for a period of 35 days.
After many debates, the main developers and members of the community decided that the need for a hard-fork on Ethereum is inevitable. The new blockchain protocol gained additional rules and a set of functions that would prevent such situations in the future.
Vitalik Buterin put it all this way:
When such a large fraction of the ecosystem is at stake, it’s worth rethinking things… A portion of the community did not download these code patches and implement the fork and they just said we will continue running our own, our old chain.