Published: Thu, November 09, 2017
Markets | By Rosalie Gross

Millions of Dollars Worth of Ethereum Got Locked Up. Here's Why

Millions of Dollars Worth of Ethereum Got Locked Up. Here's Why

Now the question is, will People who lost their ether will be able to get it back through Ethereum hard fork?

Following the July incident a new version of the Parity Wallet library contract was deployed. Partity claimed it discovered the problem when one user's wallet was wiped.

Worse, any ICOs held since the July 20 date may be impacted.

Millions of dollars' worth of ether, the digital token of the ethereum blockchain, could be frozen on a cryptocurrency wallet because one individual "accidentally" triggered a bug. However, the true total will likely not be known for some time. Parity tweeted that the funds have been frozen, rather than wiped. How long those wallets will be frozen has not been revealed. "The multi-sig used by the Web3 Foundation to accept contributions for Polkadot was one of those affected, putting the ETH in it beyond access", the firm wrote.

The flaw is the second suffered by Parity in the last four months.

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Two days after an unknown person with the GitHub handle devops199 killed the library contract associated with certain Parity wallets, freezing over 500,000 Ether, Martin Swende, the Ethereum Foundation's head of security, told ETHNews that "I see it as an objective fact that these funds can not be unlocked unless there is an hardfork involved".

An unidentified user accidentally locked up all of the recently-created digital wallets within Parity - a popular digital wallet provider - by deleting the code library required to use those wallets, according to a critical security alert posted to Parity Technology's blog on Tuesday.

By calling a function from within Parity's wallet library, a wallet owner could turn a normal single-owner wallet created with Parity's wallet contract library code into a multi-signature wallet and take over ownership of it. That would require a change to the code that controls ethereum, and then that change to be adopted by the majority of the user base. "Any solution which makes the locked funds accessible requires a hard fork". First described on GitHub by Ethereum co-founder Vitalik Buterin on October 14, 2016, these edits to Ethereum's code would aim to allow "for users with ether or other assets in common classes of "stuck" accounts to withdraw their assets".

"I am deliberately refraining from comment on wallet issues, except to express strong support for those working hard on writing simpler, safer wallet contracts or auditing and formally verifying security of existing ones".

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