Today is not a good news day for Ethereum. A vulnerability found within a popular wallet has frozen potentially hundreds of millions of dollars of the crypto currency in a second setback in recent months.
Parity Technologies, the company behind widely used wallet service Parity, today disclosed an issue that could enable the contents of a wallet to be wiped.
The issue affects multi-sig wallets — a technology that uses the consent of multiple parties for additional security on transactions — that were deployed after July 20. In other words, ICOs that were held since then may be impacted.
It’s a kicker because it is the second time in just a few months that a major Parity bug has been unearthed with potentially costly repercussions for Ethereum, which is the world’s second highest-valued crypto currency with a total market cap of over $27 billion. Back in July, a vulnerability in Parity led to 150,000 ETH (then worth around $30 million) being stolen.
That bug was fixed July 19 — hence the significance of the July 20 date — but one positive element of that first scare is that many in the Ethereum community, and particularly those who have held ICOs, backed away from the technology in favor of alternatives. Even those who did use Parity may not have opted for the multi-sig wallet.
But still it is a major security issue with wider implications. Parity explained that it found the problem when one user’s wallet was wiped: