Parity Wallet Disaster Proves Ethereum Contracts Are “Ticking Time Bombs,” NEM VP

Up to $300 million worth of Ethereum is still frozen after 'accidental' hack of the Parity multi-sig wallets.

About three days have passed since a ‘user accident’ left an estimated 500,000 to a million ETH frozen on Parity multi-sig wallets. The only good news so far for users is that Parity created a support website where they can check if their funds are affected.

Ethereum creator Vitalik Buterin has so far refrained from talking about a hard fork as a solution or even commenting directly on the situation. Developers of competing solutions, however, were quick to react.

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Jordan Earls, co-founder of Qtum and Co-Chair of the Smart Contracts Alliance, commented: “I think the big thing about Qtum concerning the Parity hack is that Qtum supports Bitcoin-style multi-sig. It’s much more simple and easy to understand, has less transaction fees, and has never been broken.”

Lon Wong

Lon Wong, President, NEM Foundation, said: “Ethereum is embraced by many, but it’s still very much experimental. This incident indicates that companies may want to reconsider using Ethereum for business deployment. There are many uncertainties regarding smart contracts on the blockchain. Ethereum’s past and present major issues are weaknesses that NEM has intentionally been developed to avoid.”

Jeff McDonald, Vice President of the NEM Foundation, added: “Contracts on Ethereum are proving to be ticking time bombs. If a project creates an on-chain contract that does not perform 100% as intended, then in many cases, that project’s best hope is for the blockchain platform owner to fork the chain for them to resolve the issue. That’s unacceptable for a blockchain, and it is the reason why NEM utilizes a completely different architecture. As a result, NEM offers-easy-to-use smart contracts that work out-of-the-box and are far more advanced than other offerings, thus fulfilling the promise of smart programmable assets in a safe and secure environment.”

The Parity team meanwhile issued this response on Wednesday: “We very much regret that yesterday’s incident has caused a great deal of stress and confusion amongst our users and the community as a whole, especially with all the speculation surrounding the issue. We continue to investigate the situation and are exploring all possible implications and solutions. Blockchain and related technologies are a vanguard area of computer science. Our mission remains to build software to power the decentralised web.”

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