Constantinople Delayed Due To Reentrance Attacks – Security Vulnerability Drives Ethereum Price Plunge

Constantinople Delayed Due To Reentrance Attacks – Security Vulnerability Drives Ethereum Price Plunge

January 16, 2019 Off Maheen Hernandez By Maheen Hernandez

Developers of Constantinople had to delay the update due to security vulnerabilities. Subsequently, the price of Ethereum plunged today.

Constantinople is the code name for Ethereum Improvement Proposal 1283.  It was scheduled to be live on Wednesday; however, a security company pointed out that there is a high risk for “reentrance attacks” to happen with the upgrade.

Reentrance attacks refer to a hacking situation where malicious players will be able to withdraw money from the same source multiple times.  Thus, repeatedly re-executing the same transaction until the wallet of the investor becomes empty.  The hacker will as well gain access to the flow of control of Ethereum Smart Contracts by making changes to the data.

Joanes Espanol, CTO of Amberdata, a blockchain analytics firm implied that an attacker would essentially withdraw funds forever. The withdrawal can be initiated while the previous function was being executed. A problem that has got its foundational advantage in the late withdrawal processing time.

The vulnerability has been reported to have occurred from EIP-1283, which does the job of introducing cheaper gas cost during SStore operations.

Node operators, miners, and cryptocurrency exchanges have been advised to upgrade to emergency versions of Ethereum.  Some of them have been proposed to downgrade to the pre-update version. Those who do not follow these instructions reportedly would be disconnected from the main Ethereum Network.  The wallets of those who are not running full nodes are completely secure.

This had happened at a time when the coin had already seen 12 months of horrible price decline, which is a 90% decline from its all-time high.

At 09:30 PM EST the price of ETH dropped further down by 6% at $120.01.  No new date has been announced for the fork.  Following the chaotic news breakout, a new activation block is expected to be announced this week.

The decision to postpone the hard fork was made in absolute caution. Ethereum did not want scammers to deceive investors by making use of this vulnerability.

Following the news, there is a very sharp decline in the price trends of Ethereum.  The intraday high was at $130 which went all the way low down to $116. There is a projection that the price of Ethereum might fall rapidly down to $100.  However, following the fall to $116, the token took a bullish run, and at the time of writing, the price was hovering at 121.93.  For all practical reasons, Constantinople upgrade has been put off for some time.

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