- CEO states that a piece of code inadvertently allowed unauthorized withdrawals of Ethscriptions from the marketplace.
- The firm plans to relaunch the Ethscriptions.com marketplace after implementing necessary protocol adjustments.
Ethscriptions, Ethereum’s innovative protocol enabling users to create and share digital objects, has faced a significant setback after its main marketplace fell victim to a hack. Tom Lehman, the co-founder of Genius.com and creator of Ethscriptions, disclosed the breach on Twitter, revealing that 202 Ethscriptions had been stolen in the incident.
Launched in June, Ethscriptions leverages Ethereum’s transaction “calldata” to write non-financial data to the blockchain, creating unique and valuable assets. While the Ethscriptions protocol itself and other applications utilizing the technology remain unaffected, the hack dealt a blow to the main Ethscriptions marketplace, Ethscriptions.com.
Ethscriptions enable non-financial and arbitrary data to be written into the main Ethereum blockchain. Users can inscribe any type of file provided it is under 96 kilobytes in size.
Tom Lehman expressed regret over the incident, especially since the marketplace was meant to serve as an example for other platforms building support for Ethscriptions. He acknowledged that any young protocol might encounter challenges, but this unforeseen event was not what he intended.
The exact value lost due to the exploit remains unclear, but some Ethscriptions have been sold for as much as 5 Ethereum on NFT marketplaces.
Taking full responsibility for the security breach, Lehman explained that the exploit could be traced back to a smart contract developed in collaboration with Michael Hirsch from Indelible Labs. A piece of code inadvertently allowed unauthorized withdrawals of Ethscriptions from the marketplace.
Despite the setback, Lehman remains committed to the project and plans to relaunch the Ethscriptions.com marketplace after implementing necessary protocol adjustments. He has been in communication with those affected by the exploit and praised the impacted users on Twitter, referring to them as “the earliest adopters” of the Ethscriptions protocol.
One of the challenges posed by this new protocol is balancing smart contract storage limitations while strategically utilizing contracts in marketplaces. Lehman emphasized the need to either provide smart contracts with the necessary information or design them to operate without needing that data.
The relaunch of Ethscriptions.com is expected once the required changes to the protocol are implemented. The latest development comes amid the crypto community reeling from the Defi protocol Arcadia Finance’s exploit. Earlier this month, the lack of a validation mechanism to cross-check unverified inputs cost Arcadia Finance approximately $455,000.