Ethereum Smart Contract Development

The rise and fall of DAO

The original, vulnerable DAO had many complex contracts but the essence was the same as that of the simple DAO we created in the previous section. In May 2016, DAO was formed by a huge crowdsourcing of funds, where stakeholders bought Initial coin offers (ICO) worth more than 150 million USD. But in the next month, June 2016, a hacker (one of the users) exploited the vulnerability to siphon out around 50 million to their own wallet. This amount was later taken back by blockchain reorganization but led to the hard fork of ETH/ETC. Calling this a "hack" is technically a misnomer because there was no break-and-enter violation of the fundraiser. It just exploited a vulnerable line of code logic present in the DAOFundraiser ...