1. Bugs in the Blockchain and “Contractual” Vulnerability
Stark Riedesel

2. Image source: https://davidgerard. co

3. Overview
Define Blockchain
Define Smart Contract
Apply AppSec

4. What’s a Blockchain? A (write-once) database with state changes
Coin moves from owner A to owner B
Balance of wallet A changes from X to Y
Coin XYZ was created and debited to owner A
Coin XYZ was destroyed by owner A
Data stored at Z location has been changed to X
Event A has been triggered with data X, Y, and Z
Similar to git, users maintain a full history
History is independently verifiable
P2P Message passing (RPC)
Image source:

5. Source: https://github.com/ethereum/wiki/wiki/White-Paper

6. Why is it “Secure”? Immutability Proof of Work (PoW) aka. Mining
SHA/Scrypt/Ethash/Equihash/etc…
Hash of previous block + Timestamp
Proof of Work (PoW) aka. Mining
Computationally intensive
Ensures history cannot change
Adjustable “Difficulty”
Hard to compute <-> Easy to check
Decentralization
All nodes have same data - “Public Ledger”
Each (full) node verifies complete history
Uses established public-key algorithms (ex. ECDSA)
Image source:

7. What does the blockchain Look Like?

8. Types of Blockchains Public Chains Private Chains Quorum
Bitcoin (currency BTC)
The “original” and largest ($250b mkt cap)
Ethereum (currency ETH)
The “original” smart contracting ledger
Monero (currency XMR)
Private transactions on a public chain
Ripple (currency XRP)
Bank-to-Bank settlements platform
Cardano (currency ADA)
Proof-of-Stake (not yet deployed)
Quorum
JPMC fork of Ethereum for permissioned chains
Proof-of-Authority (PoA)
Chain code uses EVM (Ethereum virtual machine)
Hyper Ledger Fabric
Permissioned chain for generic state changes
Chain code (usually) written in Go
State database usually CouchBase (JSON support)

9. Attacks on the Chain Double Spend - Sybil attack (51% attack)
Longest chain is the most trusted chain
Attacker creates longer chain by mining faster than the rest of the network
Attacker slows/prevents block relaying
Protected by block rewards incentivizing mining
Mining “pools” exacerbate issue
Small chains especially vulnerable

10. Extending the Blockchain
Embed “code” within a transaction
Application state  Blockchain state
Database contains:
Contracts (addresses mapped to chain code)
Contract storage (sparse hash map of memory address to value)
Balance sheet (addresses mapped to value)
Code is immutable
Code defines how state can change
Transactions “call” contract functions
Fully decentralized web applications (web3.0)
Ethereum contracts provide application logic
Geth/Parity node runs on client
Web3.js communicates with Geth to query state and send transactions

11. Smart Contract Use Cases
Tokens (ICO fundraising)
Prediction Markets
Online gaming
Trade settlements (financial services)
Legal contracting (ex. insurance)
Licensing (ex. copywrites, patents, software licenses)
Decentralized Autonomous Organizations (DAO)

12. What Does a Contract Look like?
Solidity

13. What Does a Contract Look like?
EVM Bytecode

14. Smart Contract Weaknesses
Secrecy is hard
Everything is public by design
Contract code & storage
Transaction contents
Private modifier does nothing for secrecy

15. Smart Contract Weaknesses
AuthZ is hard
Public blockchains means anyone can call your functions
Each function must explicitly check for auth
Internal functions must be marked “internal”

16. Smart Contract Weaknesses
Integers are hard
0 – 1 = 0xFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFF
Very common vuln
Can lead to buffer overruns (array length underflow)
Use SafeMath

17. Smart Contract Weaknesses
Concurrency is hard
Order of operations matter
Revert only undoes your own state
Sending transactions can have side-effects
Sending ETH can invoke a receiving function (reentrancy bugs)

18. Smart Contract Weaknesses
Randomness is hard
All nodes in the chain must agree on computation
Poor sources of entropy in chain

19. Tools for the Smart Contracting
Truffle: development build framework
Ganache: CLI/GUI fake blockchain for testing/development (instant mining, now PoW)
Geth: Official Ethereum client written in Go (most common)
Parity: Ethereum client written in Rust (second most common)
Solc: Solidity compiler
Mist: Official Ethereum web browser (built-in Ethereum client and web3 engine)
Metamask: Chrome/Firefox extension for connecting to Ethereum networks
Porosity: Ethereum decompiler/disassembler
Solhint: Solidity linter and static code analysis
Mythril: Ethereum contract search tool and static analysis engine
DappHub: Collection of useful utilities for developing, testing, and hacking on Ethereum

20. Image Source: https://congacomic.tumblr.com/
Questions?