Ethereum audit trail

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One of the biggest issues is the need to properly audit smart contracts to ensure maximum risk assessment and that there are no security issues to tamper with its performance. Some of the commonly known vulnerabilities that have troubled developers are- timestamp dependence, front-running, re-entrancy, DoS attacks, insufficient gas issues, and many more. To read more about these vulnerabilities in detail, check out our series on Smart Contract Bugs.

These vulnerabilities have been the reason behind the biggest hacks in the history of cryptos , such as the DAO hack, the KuCoin Hack, the Coincheck incident, and many others, the list is never-ending. One can never be too cautious with crypto! What you can do is, get your smart contract audited! An audit not only prevents any future hacks but also provides you with recommendations on how to make your code better and optimize its performance. The audit is to be done in such a way that it encompasses all the possible testing scenarios and observes every potential bug.

Following are the phases that are an integral part of a smart contract audit- 1. Project Familiarization Before digging into the code, the auditors will want to sit with the development team to understand the underlying architecture and intended behavior of the smart contract. Whitepapers and detailed documentation prove to be quite helpful in this phase. Code Review In the code review step, the auditing team will look more closely into the code for a complete understanding.

This can include the design and which libraries the developers used, checking the test coverage, and how the project is intended to function. Automated Analysis Concerning certain business logic, auditors conduct automated assessments using dynamic analysis tools such as— MyThrill, Hyperledger Caliper, Manticore, etc. In the initial steps, identification of bugs in the test suite that is critical to the application is highly advisable.

It also applies the usual software guidelines such as commenting code, code structure, naming variables, and the avoidance of replicated code. Some vulnerabilities surface time and again in the crypto-world, thus it seems only wise to separately test for them. These known vulnerabilities include— re-entrancy, gas limit issues, timestamp dependencies, and others.

Initial Audit Report After all these steps are completed, auditors will combine the findings and recommendations in a report for the client to review. Code Fixes After the first audit report, developers make the necessary changes and fixes to the code and turn it up again for a final review by the auditors.

A solution to this problem is encryption, i. This poses the following concerns: Why not use Twitter to store encrypted logs? Who will keep the private-key for log decryption? Users would filter through the logs somehow to get to their logs. The mapping from user-identity to the logs-IDs could be stored on a smart contract, but this information would be easily retrievable, and is against the purpose of private logs.

Since the Ethereum blockchain is immutable, once a private-key is compromised, all previously logged logs are free to be viewed by the hacker. Anchoring Using the anchoring method, logs would be stored in a conventional database. Every few minutes or hours a 'snapshot' would be taken from the database creating a checksum. This checksum can now be stored on the Ethereum blockchain, which allows for integrity verification.

The main issue with anchoring is that although integrity can be shown, it cannot be guaranteed. If someone changes the state of the database, the checksums won't match and you can't 'rollback' to a previous state. The second major concern with anchoring is the nature of the anchor itself. If a database is captured by hackers and they erase or add a few records and create a new checksum anchor, it's almost impossible to tell the difference between malicious edits and legitimate edits just by looking at the anchors stored on the Ethereum chain.

Taking these concerns into consideration, it can be concluded that using Ethereum to anchor a database isn't the best means for the goal, because tweeting the checksums for example is an evenly viable option to store the anchors. First of Chain In a First of Chain scenario the blockchain-based logging system acts as an enforced-logging database for sensitive information. In such a scenario, someone retrieving information results in an inevitable log of this access. However as with the Last of Chain scenario, the same major issue stands : everything on the Ethereum blockchain is public.

It's more public that most people realize. For example, within a Solidity smart contract one can write code which encapsulates defining variables, structs and functions. You'd assume that a variable can only be retrieved, if a function is defined to "get" that variable. Not on Ethereum. In fact it's quite easy to look up a smart contract's ethereum address, "disassemble" it and scan the contract for any variables or hidden information it might contain.

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