Rolling Back Bitcoin Blockchain like Ethereum is “Heresy,” Vitalik Buterin: “We Never Even Considered”
- Mike Novogratz says rollback of Bitcoin blockchain is close to “heresy”
- Ethereum founder says rollbacks leads to fatal and collateral damage
The effect of multi-million dollar hack on world’s biggest cryptocurrency exchange Binance can’t be seen anywhere on the crypto market as after losing about $200, Bitcoin not just recovered but in the last 24-hours, it has reached the highest level of 2019.
Though the BTC/USD price is on its own journey, the afterword conversations around this hack did stir some storm.
After the hack, Binance CEO Changpeng Zhao addressed the community via Ask-Me-Anything session. During this session, in answer to if the company would seek to convince network stakeholders viz. node operators and bitcoin miners to roll back the network transactions, Zhao said,
“To be honest, we can actually do this probably within the next few days. But there are concerns that if we do a rollback on the bitcoin network at that scale, it may have some negative consequences, in terms of destroying the credibility for bitcoin.”
For bitcoin network transactions to roll back, it requires consensus from major miners and mining pools to gather more than 51 percent of the network's total hashing power.
Though later in a follow-up tweet after speaking with various parties, Zhao stated that they won’t be pursuing the rollback, the unprecedented step considered by him was met with heavy criticism.
You didn't decide not to, you realized you cannot.
— Melik Manukyan ⚡️⚡️⚡️⚡️⚡️ (@melikmanukyan) May 8, 2019
“What good is getting money back in a system in which you’ve just destroyed confidence? Losing censorship resistance is like virginity. It only takes one time, and there’s no going back.”
“I am shocked that cz_binance even went there. Talk of forking or reorganizing the blockchain is close to heresy. When the ethereum community did it the project was like 5 months old. A baby. Bitcoin now has $100bn market cap and is a legitimate store of wealth.”
However, Ethereum didn’t roll back its blockchain either as its co-founder Vitalik Buterin replied,
“Ethereum did a surgical irregular state change. We never even considered actually rolling back the chain to undo the hack; the collateral damage from that (reverting a day of *everyone's* transactions) would have been huge and possibly fatal.”
In mid-June, 2016, an attacked drained over 3.6 million Ether and in response Buterin issued a critical update in the form of a software fork with “no rollback” that moreover had no reversal of transactions or blocks.
And this time as well, Zhao reported that Binance has enough resources and loss of $40 million will be recovered from Secure Asset Fund for Users (SAFU) fund. Since July last year, the exchange has been allocating 10 percent of its trading fees every month into the SAFU fund.