We Need to Work on Decentralized Domain Name Systems, Says CEO of Hacked Waves DEX

Waves DEX remarkably generated about $6 million in its beta testing phase and then got subjected to the attention of hackers.

Waves exchange was performing very well although it was not fully launched yet. It had almost 90,000 traders who possessed about 330,000 wallets back then. Comparison reports show that Waves DEX surpassed all previous DEXs and looked very promising.

Several reasons accounted for this impressive performance of Waves DEX. Firstly, the speed offered by it was so much more than offered by any other DEX at the moment. Moreover, the facility provided to traders for getting any token issued on Waves platform and afterwards trading it with Bitcoin, almost instantly on exchange contributed to the popularity of Waves DEX a lot. Besides this, Waves made KYC optional for most of the time to its users and therefore, gained a lot more attention in short span of time.

Although KYC helped Waves to gain attention before its launch, however it didn’t prove be beneficent after Waves DEX  beta testing phase ended. Unfortunately, hackers used the very same feature in their interest and hacked user’s personal wallets along with company’s site for several hours after DEX was launched. According to CEO, Sasha Ivanov, hackers somehow managed to change password through support staff of domain company. He said that hackers faked the passport to support staff in order to access company’s main website.

Someone just faked my passport and gave it to support [staff] at the domain company and they changed the password at his request. Then the attacker was able to change the main website.

Waves team spent several hours to get back the control from hackers and amazingly, despite criticism for security failure by Waves, Ivanov believes that Waves platform will be looked forward by banks. The optimism is evident in following statement:

We are looking for partnerships with major banks because we hope major banks will want to issue their own fiat tokens.

Waves platform is very similar to Ethereum as both allow their respective tokens to be used to incentivize node operators. At the moment, Waves posses nearly 200 nodes. RewardMob,a Canadian mobile gaming company, manages one node and finds DEX very favorable for their users. CEO of RewardMob ,Todd Koch, told in his interview to CoinDesk how he was availing the advantage of DEX. He stated:

Now we don’t have to worry about currency control from different countries and players wanting to cash out in different currencies. It allows players to trade their tokens between other players…The decentralized exchange was a huge, key component in our decision to go with Waves.

Todd Koch is working on his own Waves based tokens and wishes to facilitates the transactions and trading of tokens for players playing video games made by his company. He further explained his plans for improvising his vision through Waves DEX by saying:

We want to integrate the DEX right into our app so that [when] a player earns our currency, they could easily exchange it for Waves or bitcoin or any other cryptocurrency.

Even though the opportunity offered by Waves for running matchmaking on owned nodes, exhibit benefits like enjoying the processing fee, still, surprisingly Waves’s own central matchmaker is seeing most of the trading activities. This is extremely contradictory to the concept of DEX as there lies no point whatsoever in offerings a DEX if it can be denied by a central authority. Ivanov acknowledges this fact and admits the need for changing it by saying:

A centralized matcher can just say ‘I don’t accept the trade,’ for now, so it’s important for us to make it more trustless.

Last year, Kudelski Security directed vulnerable lose ends for Waves. According to their audit, users’ wallet passwords could be read by anyone accessing the file system so that’s why after audit, Ivanov took action by storing them in more secured place.

Ivanov was compelled to take steps after the criticism Waves had undergone due to getting hacked. The steps and measures to safeguard from such phishing attacks can only be ensured with an identity system:

We and the whole industry need to work on decentralized domain name systems.

Blockstack might be the ID solution for the whole decentralized internet.

Notwithstanding hacking activity, Ivanov holds eagerness and optimism to move forward. The confidence remains there on the potential and future offered by Waves as its claimed to handle 500 transactions per second and Ivanov seems much confident with a simple statement;

Our blockchain is quite fast.

Fatir Malik

Electrical engineer by profession, turned into blockchain developer. Fatir contributes regularly with his insights about latest developments in fintech sector. Contact the editor at editor.opinions@blockpublisher.com

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