Smart Contract (Ethereum)

Put code in blockchain

• a special tx type
  • a program (a class object): “smart contract”
  • a special account
    • has address
    • can hold balance
    • can receive / send
  • initialization execution
  • have permanent storage space
• calling a function in a smart contract
  • by send
• a language-level virtual machine
  • avoid non-deterministic operation
    • external: trusted data sources
  • avoid computation and storage abuse: gas
  • isolation for safety

Application exampls

• IoT
• paycheck systems
• insurance

Application: token systems

• token systems examples
  • reward points
  • new currency (coins)
  • shares
• a ledger
  • key variable: balances
  • key function: transfer
• ERC20: a template to set up a token system quickly
  • totalSupply()
  • balanceOf(account)
  • transfer(recipient, amount)
  • transferFrom(sender, recipient, amount)
  • approve(spender, amount)
  • allowance(owner, spender)
• You can add other functions / smart contracts to “trade” tokens
  • between the token and ETH
  • between tokens

Application: stabilize price

• between token and eth
  • set up a smart contract that buy a token at a price in the future
• between token/eth and USD
  • A and B both deposit in a smart contract 1000 eth, worth of X USD at the time
  • after a pre-defined time period, return X-worth of eth to A and the rest to B

The DAO attack

• decentralized autonomous organization
• a token system that allows deposit and withdraw

function getBalance(address user) constant returns(uint) {
  return userBalances[user];
}

function addToBalance() {
  userBalances[msg.sender] += msg.amount;
}

function withdrawBalance() {
  amountToWithdraw = userBalances[msg.sender];
  if (!(msg.sender.call.value(amountToWithdraw)())) { throw; }
  userBalances[msg.sender] = 0;
}

• attack/ recursive withdraw

// msg.sender has a default function that looks like this.
function () {
  // To be called by a vulnerable contract with a withdraw function.
  // This will double withdraw.

  vulnerableContract v;
  uint times;
  if (times == 0 && attackModeIsOn) {
    times = 1;
    v.withdraw();
   
   } else { times = 0; }
}

• a possible fix

function withdrawBalance() {
  amountToWithdraw = userBalances[msg.sender];
  userBalances[msg.sender] = 0;
  if (amountToWithdraw > 0) {
    if (!(msg.sender.send(amountToWithdraw))) { throw; }
  }
}