Preventing Smart Contracts From Cyber Attacks
The Idea of Preventing smart contract from cyber attacks should not be ignored by anyone who is into Smart Contract already or by those that intend to make Smart Contract their next stop.
The volatile way at which blockchain is built requires an active security system that will enable you to monitor and regulate it activities.
Smart Contract is an independent practice environment in the world of cryptocurrency, that is, it does not give room to third party involvement.
Smart Contract is very secure, and can run automatically without any human involvement.
Some of the benefit of Smart Contract as a forum that disapprove middleman is that it makes transaction to be cheap, since there is nobody to be paid, it also makes it easy and transparent.
Smart contract’s data is recorded in a decentralized ledger, this provide some level of security.
But the volatile nature of the Crypto world makes everything to be prone to attack, this is because, some bad eggs consistently learn how to breach a new level of security regardless of how tight and secured it seems to be.
This article will give you insight into possible mistakes that lead to the vulnerability of Smart Contract to Hackers and how such mistakes can be avoided.
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How Does Smart Contract Operates?
The operation of Smart contract is based on the use of coding to ensure that terms of agreement is met.
The contract will run automatically when the agreement of the parties involves concluded. After processing the contract into blockchain it cannot be altered.
To explain this, if two people agree to a Smart contract to sell a furniture at a certain amount, once the agreement is done and the transaction is processed on the blockchain, that is the end of it, it cannot be stopped neither can it be adjusted.
How Criminals Can Easily Hack Smart Contract
The fact that Smart contract is automated and has no third party involvement in the transaction process does not make it all invisible.
There are people that dedicate their time to breaking new coordinate, no matter how complex it is, just like any technology that has been in existence, Smart Contract are not immune to weaknesses.
Some of the flaws that can expose Smart contract to Hackers are listed below.
- Overflow/Underflow
The result of overflow and underflow is a very terrible one this is because a user that process withdrawal transaction and end up with an unfavorable balance.
Also, a criminal can create a value on an asset in other to get around a restriction that was placed by Smart contract developers.
Overflow and underflow is witnessed when the mathematical operation result surpasses the bounds of a data type.
- Reentrancy Attacks
This type of attack can be very difficult to identify, this is because the code is working perfectly, the hackers can be working tirelessly behind the scene to infiltrate the system until they succeed.
There are a lot of technique features which can be deployed by developers to tackle reentrancy attacks.
This is by creating mutex locks to stop repeated execution of the same contract, they can also set gas consumption limits to tackle long recursive functions.
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- Timestamps Dependency
This is another issue that can result to system breach. Smart contract can use timestamp to validate time-sensitive situation.
Attackers can take advantage of this loophole by changing the timestamp or by starting a transaction at a particular time to causing something to happened when it was not supposed to happened.
What a developer should do is to check the fact about a certain situation without relying on timestamps, but by using block numbers.
They can also give time of transaction, that is, to give time bound to prevent transaction execution beyond a certain time.
- Wrong Calculation
Smart contract depends on absolutely correct calculation. Calculations that are inaccurate will result to problem.
For example, if a smart contract contains inaccurate calculation, it can enable hackers to have access to certain restrictions which will give them access to exploit the Smart Contract owner.
It can also make consumer trust in the smart contract if a computation error gives wrong result or inaccurate token balance.
- Malicious Libraries And Dependencies
Libraries and dependencies are frequently used in Smart contract, and it is from other sources.
The problem is that these libraries and dependencies can give access to attackers to manipulate the fund if they are malicious.
Hackers can go through the backdoor of these Libraries, if there is any loophole they will leverage on it to their advantage.
How to Prevent Smart Contract Hacks
The following measures can be used to curtailed Smart Contract Hack.
- Implement Boundary Condition Check
- if boundary condition check is implemented with also minimum and maximum input parameter value integer overflow and underflow will be tackled to the minimum.
- Use a well audited Libraries: this can help to lower the risk of exposing Smart Contract to hackers. Using any code that is untested should be avoided.
- Ignore timestamp dependency: developers should ignore using timestamp dependency. Such method should not be use as the only background of conducting Smart Contract Logic.
- Ensure Accurate calculating: the right operation of smart contract depends on correct calculation. In the case of solving complex mathematical calculation developers should use good recommended libraries and to also make sure that their calculation is correct.
- Security Audit: this is useful in locating loopholes in smart contract. Before you deploy your smart contract, you should involve a smart contract audit company to audit. This will help in figuring out issues that would have pose a problem in the future.
- Bug Bounties: you can also involve security researcher to uncover and raise alarm on any smart contract flaws that is found in the process of investigation. You can also put on bounties to any of the security researchers to fix any kind of the vulnerabilities that is found.
Final Note:
Even as Smart Contract offers a comfortable and secured way of performing transaction in the blockchain it is also prone to attacks.
Every new technology is accompanied with a new problem, no matter how secured it is, this is because technology is volatile in nature and hackers worked hard to fine doors or vulnerable openings to manipulate the system.
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Meet Daniel Abang: Crypto guru, content creator, and analyst. With a deep understanding of blockchain, he simplifies complex concepts, guiding audiences through the ever-changing crypto landscape. Trusted for his insightful analysis, Daniel is the go-to source for staying informed and empowered in the world of cryptocurrency.
