Crypto Confronts Own Y2K Moment With Ethereum Network Upgrade

Airplanes wouldn’t be able to land. Power plants would shut down. Those were just some of the dire predictions faced by computer programmers and users worldwide as the year 2000 approached. In the end, the millennium bug that was widely expected to create computer chaos turned out to be more of a punch line to jokes than an actual problem.

Two decades later, the crypto world could be facing its own Y2K moment, when the Ethereum network undergoes a major software upgrade in September. The revamp, known as the Merge, is being billed as a seamless transition that shouldn’t be noticeable to users of the most commercially important blockchain. Not everyone is convinced, especially when it comes to the more than 3,400 active distributed applications that are built on the platform.

“You know there will be those edge cases that will be interesting and exploitable,” said Toby Lewis, chief executive officer of Novum Insights, a crypto analytics provider. “One thing I can guarantee, it’s going to be a very bumpy ride.”

Observers just need to look back to Ethereum’s 2016 upgrade, when the network was besieged for weeks by so-called replay attacks, where hackers replayed users’ transactions to steal tokens. The Yunbi exchange reportedly lost 40,000 Ethereum Classic coins. Developers have since implemented network-based protection measures. Even so, attacks could still take place if any of the self-executing software programs called smart contracts that run the myriad of apps on the network haven’t been built correctly, according to Josselin Feist, engineering director for blockchain assurance at Trail of Bits, a security firm that audits the self-executing contracts.