Callisto Network
WebsiteSecurity DepartmentTwitter
  • Whitepaper
    • ๐Ÿ‡ฎ๐Ÿ‡นWhitepaper (ITA)
    • ๐Ÿ‡ฎ๐Ÿ‡ณWhitepaper (TELUGU)
    • ๐Ÿ‡ฎ๐Ÿ‡ณWhitepaper (HINDI)
    • ๐Ÿ‡จ๐Ÿ‡ณWhitepaper (CN Traditional)
    • ๐Ÿ‡ญ๐Ÿ‡ฐWhitepaper (CN Simplified)
    • ๐Ÿ‡ซ๐Ÿ‡ทWhitepaper (FR)
    • ๐Ÿ‡ต๐Ÿ‡ญWhitepaper (PH)
  • ๐Ÿ“ŒStrategic Plan
  • Callisto Network Vision
  • ๐Ÿš€Callisto Network Progress Tracker
  • ๐Ÿ—“๏ธEcosystem Reports
    • Callisto Monthly - February 2023
    • Callisto Monthly - January 2023
      • ๐Ÿ‡ฎ๐Ÿ‡นCallisto Monthly - January 2023 (ITA)
      • ๐Ÿ‡ซ๐Ÿ‡ทCallisto Monthly - January 2023 (FR)
      • ๐Ÿ‡ฎ๐Ÿ‡ณCallisto Monthly - January 2023 (TELUGU)
    • Callisto Monthly - December 2022
      • ๐Ÿ‡ฎ๐Ÿ‡นCallisto Monthly - December 2022 (ITA)
      • ๐Ÿ‡ซ๐Ÿ‡ทCallisto Monthly - December 2022 (FR)
      • ๐Ÿ‡ต๐Ÿ‡ญCallisto Monthly - December 2022 (PHI)
    • Callisto Monthly - November 2022
      • ๐Ÿ‡ซ๐Ÿ‡ทCallisto Monthly - November 2022 (FR)
      • ๐Ÿ‡ฎ๐Ÿ‡นCallisto Monthly - November 2022 (ITA)
      • ๐Ÿ‡ฎ๐Ÿ‡ณCallisto Monthly - November 2022 (TELEGU)
    • Callisto Monthly - October 2022
      • ๐Ÿ‡ฎ๐Ÿ‡นCallisto Monthly - October 2022 (ITA)
      • ๐Ÿ‡ซ๐Ÿ‡ทCallisto Monthly - October 2022 (FR)
      • ๐Ÿ‡ต๐Ÿ‡ญCallisto Monthly - October 2022 (PHI)
      • ๐Ÿ‡จ๐Ÿ‡ณCallisto Monthly - October 2022 (CN Simplified)
      • ๐Ÿ‡ญ๐Ÿ‡ฐCallisto Monthly - October 2022 (CN Traditional)
      • ๐Ÿ‡ท๐Ÿ‡บMonthly - October 2022 (RU)
    • Callisto Monthly - September 2022
      • ๐Ÿ‡ฎ๐Ÿ‡นCallisto Monthly - September 2022 (ITA)
      • ๐Ÿ‡ซ๐Ÿ‡ทCallisto Monthly - September 2022 (FR)
      • ๐Ÿ‡ต๐Ÿ‡ญCallisto Monthly - September 2022 (PHI)
      • ๐Ÿ‡จ๐Ÿ‡ณCallisto Monthly - September 2022 (CN Simplified)
      • ๐Ÿ‡ญ๐Ÿ‡ฐCallisto Monthly - September 2022 (CN Traditional)
    • Callisto Monthly - August 2022
      • ๐Ÿ‡ฎ๐Ÿ‡นCallisto Monthly - August 2022 (ITA)
      • ๐Ÿ‡ซ๐Ÿ‡ทCallisto Monthly - August 2022 (FR)
      • ๐Ÿ‡ต๐Ÿ‡ญCallisto Monthly - August 2022 (PH)
    • Callisto Monthly - July 2022
      • ๐Ÿ‡ฎ๐Ÿ‡นCallisto Monthly - July 2022 (ITA)
    • Callisto Monthly - June 2022
    • Callisto Monthly - May 2022
    • Callisto Monthly - April 2022
    • Callisto Monthly - March 2022
  • Technologies
    • ๐Ÿ“ˆCallisto Dynamic Monetary Policy
      • Crypto-models To Overcome Inflation and Callisto Network's Approach
      • Skuld Hard Fork - Update On Progress
    • ๐ŸงŠCold Staking
      • Cold Staking And PoS Staking Comparison
    • ๐Ÿช™Wrapped Callisto (ccCLO)
    • ยฎ๏ธDexNS 2021
    • โ›๏ธProof of Work
      • ZPoW #1 - Exploiting The Block Time & Block Size
      • Callisto Network Introduces the Dynamic Gas Price
    • โ“‚๏ธCallisto Network Masternodes
    • ๐ŸŽ“Tutorials
      • Setting Up Metamask For Callisto Network
        • Update the RPC URL in MetaMask
      • How to buy Callisto with Your Credit Card
      • How to Run a Callisto Network Node?
      • Callisto Network Masternodes Set-up
    • ๐ŸŒCallisto Hub
    • ๐ŸงฉWeb 3.0 Infrastructure
    • ๐Ÿ”Chain Inspector
  • We Fund You!
    • ๐Ÿ’ฒWe Fund You!
      • We Fund You Award - 1st Edition
  • Security Department
    • ๐Ÿ”Auditing Department
      • Auditing Department Amendment v5
    • ๐Ÿ“–Documentation
      • ๐Ÿ›ก๏ธSecurity Department Best Practices
      • ๐Ÿช™ERC 223 Token Standard
        • ERC20 Standard Main Issue
      • ๐Ÿ–ผ๏ธCallistoNFT Standard
        • Roadmap
      • โœ–๏ธCross-Chain Bridges Security Model
    • Products & Services
      • ๐Ÿ”Security Audits For Smart Contracts
        • Mission: Securing The Smart Contracts Ecosystem
        • Trust and Smart Contracts: Code is the Limit
    • ๐ŸคVarious Contributions
      • Ethereum Classic
        • ECIP-1092 51attack solution: PirlGuard & Callisto proposal
      • Ethereum
        • Statement regarding Geth v1.10.8 split
      • EOS
        • Page 1Chintai (EOS resource exchange) low severity issue.
        • EOS congestion 9/13/2019 and EOSPlay hack
      • Ultimate solution to 51% attacks: amend the Nakamoto consensus
  • Hack Investigation Dept.
    • Hack Investigation Department
    • Helio Exploit
    • Binance Bridge Hack
    • TempleDAO's STAX Contract Hack Investigation
    • NFT Theft Analysis
    • AUDIUS Governance System Exploit Overview
    • LUNA โ€˜Hardforkโ€™ Review
  • One Earth, One Heart
    • ๐ŸŒŽOne Earth, One Heart
    • ๐Ÿ’šCallisto Charity Efforts
  • Community
    • ๐Ÿ“ฅCallisto Network Improvement Proposals
    • ๐Ÿ’ฌCallisto AMAs
      • Callisto Team's Ask Me Anything on 04/05/2023
      • Callisto Team's Ask Me Anything on 03/03/2023
      • Callisto Team's Welcome AMA on 10/11/2022
      • Callisto Team's Ask Me Anything on 10/10/2022
      • Callisto Security Team's Ask Me Anything on 02/09/2022
      • Callisto Team's Ask Me Anything on 28/07/2022
      • Dexaran's Ask Me Anything on 11/04/2022
    • ๐Ÿ“ŒGet Started
  • Callisto Enterprise
    • ๐Ÿช™Callisto Enterprise Token
      • Vision and Tokenomics
    • ๐Ÿ‘ฅTeam
      • Callisto Team Motivation System
  • In The Press
    • ๐ŸŸขCallisto Network
      • Ethereum, Ethereum Classic, Callisto Network, A Common History
      • Callisto Network: Three Years After Mainnet Launch
      • Czech Ethereum Killer
    • ๐Ÿ–ผ๏ธNFTs
      • Artist Creates And Then Destroys Art To Launch CallistoNFT
      • Security Network Develops New NFT Standard To Address ERC-721 Flaws
  • Miscellaneous
    • ๐ŸงฉMedia Kit
Powered by GitBook
On this page
  • Context
  • Immutability of Ethereum Based Smart Contracts
  • Smart Contracts Security, Are Your Funds Safe?
  • Trust the Blockchain, Audit the Smart Contracts
  • Conclusion
  1. Security Department
  2. Products & Services
  3. Security Audits For Smart Contracts

Trust and Smart Contracts: Code is the Limit

PreviousMission: Securing The Smart Contracts EcosystemNextVarious Contributions

Last updated 2 years ago

Context

As the crypto revolution continues to gain momentum and draw worldwide attention, more focus is placed on the real use cases and distributed ledger technology applications. One of the most useful applications is perhaps one of the least understood: smart contracts.

Smart contracts are a means of executing code stored on a blockchainโ€™s network, which constitutes the source of truth.

Since blockchains require universal consensus, smart contracts are only as good as their code, particularly in their limitations of what is possible, and perhaps more importantly, their security.

That being said, there appears to be some confusion among the public as the applications that smart contracts allow and the appropriate level of trust that should be placed in them.

Immutability of Ethereum Based Smart Contracts

Ethereum is, without doubt, the best-known platform for developing and executing smart contracts and decentralized applications (DApps).

A key point of Ethereum-based smart contracts is the inability to modify them effectively. In most cases, it is either impossible or excessively expensive to modify even slightly a smart contract after it has been deployed on the network. If a mandatory legal clause, incorrect recipient data, or a serious security vulnerability is discovered after the contract has been launched, it is typically an error that cannot be corrected.

Depending on the number of resources involved, this may not be acceptable to participants, and recurrent cases where funds have been lost due to the inability to modify a smart contract will dissuade most non-technical users from actively engaging with smart contracts.

Fortunately, modular smart contract protocols are being tested to update existing contracts by replacing data in files without losing the data they contain. Over time, smart contracts will become more flexible, leading to greater enforcement at the enterprise level as the risk of non-compliance with fiduciary responsibilities, and legal compliance can be appropriately managed and mitigated.

Smart Contracts Security, Are Your Funds Safe?

Businesses and individuals who are willing to transact via smart contracts are apprehensive about doing so following the recent DeFi projects hacks and other public (and not so public) smart contracts exploits.

Security is at the forefront of anyoneโ€™s mind when transacting with a new technology that is not well understood. Letโ€™s suppose you manage a business and that you have a fiduciary responsibility to your client. You are considering using an Ethereum based smart contract for recurring payments to automate routine activity over a given period, reduce your OPEX expense and remain competitive in a saturated industry, such as financial services or management consulting.

When you decide to place clientsโ€™ funds in a kind of escrow (for example a smart contract), you MUST be sure that these funds are safe and that they will be paid following the terms of the agreement. In the case of a conventional escrow, an agent can generally resolve most issues between the parties based on the terms of the agreement and a reasonable interpretation of the contractโ€™s terms. Alternatively, he can refer the case to an arbitrator who can review the facts and issue a binding judgment. With a smart contract, these procedures are automated and the contract is invoked according to the code, which cannot be modified in case of extenuating circumstances.

The execution of this smart contract requires the consensus of the network. If it fails to reach a consensus, it will not execute the payments and thus reduce the escrow contract to nil.

For most, the opportunity cost of a secure, reliable, automated, and quickly understood escrow solution is simply too high. Not to mention the vulnerabilities that may exist in the code, making the funds permanently unrecoverable.

Trust the Blockchain, Audit the Smart Contracts

The focus on Ethereum-based smart contracts has been extremely negative, largely due to the infamous hacking of DeFi projects and the resulting multi-million dollar losses.

However, the specific vulnerabilities of the publicly known attacks were covered at length, simply stating that they could have been avoided if the code had been properly audited and/or if the contracts had not been deployed in haste.

Callisto Network provides a complete audit service for smart contracts deployed on Ethereum and Tron. The audited contracts will be subject to a professional code review, flagging vulnerable contracts for revision prior to their execution to prevent them from being hacked.

Conclusion

People tend to favor peace of mind to automation and cost reduction through smart contracts. The security of a contract, whether perceived or real, is only tangible if it is well understood. A lack of comprehension of the vulnerabilities and limitations of smart contracts has created a stigma for their use in areas such as escrow services, asset transfers, and simple trustless transactions.

Therefore it is reasonable to expect a larger adoption of Ethereum-based smart contracts as security vulnerabilities are addressed through audits, flexibility and ease of use are increased.

๐Ÿ”