- Stanford suggests new Ethereum Standards that allow reversible transactions.
- The ERC-20R and ERC-721R are expected to combat illegal activities.
- The proposed standards won’t make the entire ETH network reversible.
Researchers at Stanford University have designed a prototype for “reversible transactions” on Ethereum, which they argue could mitigate the effects of crypto theft.
The new Ethereum token standards, termed ERC-20R and ERC-721R were proposed by Stanford scientists Kaili Wang, Qinchen Wang, and Dan Boneh. These prototype opt-in token standards allow for the reversal of transactions when the circumstances require it.
In the event of a hack or theft, the paper calls for a blockchain “back button” or “undo button.” It argues that reversible transactions are necessary in light of recent events like the BAYC phishing attempts, Poly Network attack, Harmony Bridge hack, and Ronin theft.
One of the researchers, Kaili Wang, commented on the matter, stating:
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 decentralized quorum of judges.
Wang emphasized, however, that the prototype was not intended to replace ERC-20 tokens or render Ethereum reversible. Rather, it is an opt-in standard that “allows a short time window post-transaction for thefts to be contested and possibly restored.”
If someone’s tokens are stolen, they can file a request with a governance contract to have their assets frozen. As a result, a decentralized court of judges will need to vote “within a day or two at most” on whether or not to grant the request.
In the event that an attacker is aware of the impending freeze on the transactions, the researchers suggested performing the full freeze on-chain in a single transaction “so that the attacker can’t outrun the freeze.”
The researchers did admit that selecting the judges who would be in charge of ruling on the planned ERC-20R and ERC-721R tokens was the most ambiguous component of the system.
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