‘Hackers’ become the new lawyers, finding and patching smart contract security holes

The advent of blockchain 2.0 and blockchain 3.0 has given rise to new ways to use blockchain for automation. Some special cryptocurrency platforms, such as Ethereum, Rootstock, Counterparty, Lisk, etc., allow people to create smart contracts on the blockchain. These smart contracts enable automation by allowing developers to set trigger conditions. These trigger conditions are specific prerequisites that, when met, will execute the functions written on the smart contract.

Smart contracts are being implemented (in pilot phase) by some large banks and financial institutions, including exchanges. In addition to the financial industry, smart contracts have many other applications, such as crypto-wills, a self-executing will and final proof on the blockchain that is triggered once the creator dies. As more operations tend to be automated using smart contracts, it is necessary to ensure the integrity of these smart contracts and the platforms that create them.

Hackers are the new lawyers

Until now, agreements and other important documents have been drafted and verified by lawyers, but with smart contracts, there will be less that lawyers can do. Verification of the authenticity and reliability of smart contracts will be left to various experts known as blockchain architects or smart contract engineers. However, the responsibility of assessing smart contract vulnerabilities and plugging them will fall on hackers. Yes, you heard it right, hackers will become the new type of lawyers.

Charlie Lee recently stated this change quite bluntly on Twitter. He said:

“In the future, we will hire hackers to check smart contracts, just like we hire lawyers to check real contracts today.”

We can be sure that Charlie was not referring to black hat hackers in his tweet. White hat hackers are an important part of cybersecurity. The role of white hat hackers is to find security vulnerabilities in all platforms or software by hacking into them under controlled conditions, and then find solutions to patch these vulnerabilities so that people with bad intentions cannot abuse these vulnerabilities in the future.

The recent attack on Ethereum-based The DAO, where an ‘attacker’ managed to siphon 3.6 million ether into a child DAO, demonstrates how vulnerable blockchain-based smart contracts and decentralized autonomous organizations remain. It also highlights the need to extensively test all of these blockchain-based platforms and smart contracts for security flaws and vulnerabilities, which is a standard job requirement for white hat hackers.

Once smart contracts become the norm, every smart contract will be passed to hackers, just as contracts are handed over to corporate legal teams before execution, making hackers a new type of lawyer in the decentralized era.