Concerns Over Legal Ledger Amendment Proposal Makes Ethereum Code Editor Resign

Following personal fears that an Ethereum Improvement Proposal (EIP) over a standardized format for lost fund recovery potentially violated Japanese law, Ethereum code editor Yoichi Hirai had to resign from his position.

Hirai both tweeted his resignation plus posted a more stagy explanation of his reasons for resigning on Github:

“My blood pressure got higher the moment I found this draft. I don’t sleep well. My family accuses me of mental absence. I believe these are signs that my abilities are not ready for the task of the EIP editorship. I resign from the post of an EIP editor.”

Musiconomi developer Dan Phifer and two developers from startup TapTrust introduced said the proposal, which seeks to create a solution method for a simpler way to adjust the Ethereum blockchain that would allow reorganizing address balances in the case of lost funds.

A hack last June on the Equality Ethereum client caused Musiconomi to lose their ether raised by crowdfunding when Parity froze their multi-sig wallet. Phifer’s proposal would allow such lost funds on the Ethereum platform to be returned in the case of a similar future hack.

Hirai’s allegedly main problem with the proposal is what he sees as its conflict with a Japanese penal code on the “Unauthorized Creation of Electromagnetic Records.” He writes on Github that he doesn’t think that “anybody has the authority to make an irregular state change”, because he doesn’t believe that Ethereum users know about or authorize the EIP process, and thus doesn’t want the non-democratically chosen EIP leaders to make this kind of rules for Ethereum users.

Hirai adds that he thinks the proposal is “at odds with the Ethereum philosophy”, because Ethereum was made to avoid “single points of failure and the need of trust”. In a later comment, Hirai revised that he could ignore his understanding of the Ethereum philosophy, but that he can’t ignore violations of the penal code.

Software engineer Afri Schoedon, who also works in community management at Ethereum and technical communication at Parity, has come out strongly in favor of Phifer’s proposal. In response to Hirai’s negative comments about the proposal on Github, Schoedon tweeted asking Hirai to step down as an EIP editor:

I don’t want to be part of the #Ethereum community anymore if only one person can independently block any proposal based on a Japanese law that bans the unsanctioned creation of electromagnetic records.

Hirai replied directly to the call for resignation, tweeting that stepping down would signal that he allows other people to ignore the penal code and thus break the law. Conversely, Hirai did resign about 10 hours after that tweet.

Hirai’s resignation over this proposal, even though he cites his personal legal responsibility as his impetus, brings up the question of whether Blockchain should be amendable in the case of hacks or errors that lead to a loss of user funds.

The recent hack of Nano from the BitGrail exchange caused an uproar in the crypto world when it came out that Bitgrail’s owner had purportedly asked for the altcoin’s ledger to be altered to cover the losses.

The biggest case of conflict over the nature of Blockchain’s ability to be amended was the repercussion of the DAO hack when stolen funds were moved back to their rightful accounts through a hard fork that led to the split between Ethereum (ETH) and Ethereum Classic (ETC). Ethereum Classic is the original Blockchain where the stolen money remained with the hackers.

Vitalik Buterin, co-founder of Ethereum, had tweeted on Feb. 14 in response to a @whalepool tweet criticizing him for his decision to hard fork Ethereum, “doing rescue forks in exceptional circumstances can be a great choice for budding early-stage blockchains.”

In response to Buterin’s tweet, Greg Maxwell, former Bitcoin developer, posted on Reddit that Ethereum’s operators are missing the main point of the hard fork debate:

“The point they’re missing? No one should have that power. If there is even a choice to make the system has already failed.”