Stanford University researchers create prototype to reduce cryptocurrency-based thefts

Stanford University researchers create prototype to reduce cryptocurrency-based thefts

Stanford University researchers have reportedly devised a prototype for Ethereum-based reversible transactions by making the argument that it could lead to the reduction in the impact of cryptocurrency thefts, as reported by Cointelegraph.

According to Cointelegraph, in a recent tweet, Kaili Wang, blockchain researcher, Stanford University, shared a run down of the Ethereum-oriented reversible token idea, which stated that it is a proposal to provoke discussion and receive solutions from the blockchain community.

“The major hacks we’ve seen are undeniably thefts with strong evidence. If there was a way to reverse those thefts under such circumstances, our ecosystem would be much safer. Our proposal allows reversals only if approved by a decentralised quorum of judges,” Wang stated. 

On the basis of information by Cointelegraph, the proposal was drafted by Stanford-based blockchain researchers, including Wang, Dan Boneh, Qinchen Wang, and it stated opt-in token standards that are related to ERC-20 and ERC-721, dubbed ERC-20R and ERC-721R. Wang made the clarifications that the prototype wasn’t meant to replace ERC-20 tokens or make Ethereum reversible. Under the proposed token standards, if someone’s funds are stolen, then a freeze request on the assets to a governance contract can be submitted. Both parties of the transaction would be able keep evidence to the judges, for them to have enough information to be able to come to a fair decision. However, the proposal accepted that freezing fungible tokens is complicated, as thieves can share the funds among other accounts, process them using an anonymity mixer or exchange them in other digital assets.

Moreover, Cointelegraph noted that Wang’s Twitter post created a lot of discussion, with people asking further questions, supporting the idea, refuting it or stating their own ideas. Ether (ETH) bull and podcaster Anthony Sassano expressed his displeasure with the tweet, and explained that reversal control and consumer protections should be kept on higher layers such as exchanges and companies.

“Doing it at the ERC20/721 level would basically be doing it at the “base layer” which I don’t think is right. End-user protections can be put in place at higher levels such as the front-ends,” Sassano added.

(With insights from Cointelegraph)

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