Ethereum Virtual Machine (EVM): A Powerful Yet Vulnerable Engine

The Ethereum Virtual Machine (EVM), often described by experts as a powerful and innovative piece of the Ethereum blockchain, is an essential component that enables the execution of complex applications directly on the Ethereum blockchain.

The EVM is an integral part of the Ethereum architecture, powering its smart contracts and decentralized applications. The code running inside the EVM has no access to the network, file system, or other processes. This isolation makes it an ideal environment for running untrusted code.

However, it's not all sunshine and roses. Despite its robust architecture, the EVM and its associated smart contracts have been found to have several vulnerabilities. From common Solidity vulnerabilities to more complex issues, these vulnerabilities can be exploited, leading to significant losses.

A glaring example of this was the DAO hack in 2016, where a bug in the DAO smart contract was exploited, resulting in the theft of 3.6 million Ether. This incident led to a hard fork in the Ethereum blockchain, creating two separate versions: Ethereum and Ethereum Classic.

Far from what we may want to hear, low-level vulnerabilities in Ethereum Virtual Machine (EVM) exist due to the fundamental design and implementation of the EVM and its associated languages, such as Solidity. Attackers can exploit these vulnerabilities to manipulate smart contracts or decentralized applications running on the Ethereum blockchain.

Some examples of low-level vulnerabilities include:

1. Reentrancy Attack: This vulnerability allows a called contract to call back (re-enter) the original contract before the first call is finished, potentially leading to unexpected behaviour or a breach of security. The infamous DAO attack was a result of this vulnerability.
2. Integer Overflow and Underflow: In the EVM, if an unsigned integer variable exceeds its maximum value, it wraps to zero (overflow). Similarly, if it goes below zero, it wraps to its maximum possible value (underflow). Without proper checks, these behaviours can be exploited.
3. Unsafe Low-Level Calls: Low-level calls in EVM are powerful but potentially dangerous. They can lead to unexpected behavior if not properly handled. For example, a low-level .call() function in Solidity forwards all remaining gas, opening up the potential for reentrancy attacks.
4. Gas Limit Issues: In Ethereum, computation is metered using a unit called gas. If a contract operation exceeds the gas limit, it fails, which can be used maliciously in a denial-of-service (DoS) attack.
5. Exposure of Sensitive Functions: If sensitive functions are not properly protected, they can be called by any address, potentially leading to unauthorized actions.?

The Question of Smart Contracts

The smart contracts present in Ethereum are also causing a lot of tension, so much that Vitalik Buterin himself has pointed out they need some fixing.? In addressing Ethereum's persistent challenges, he mentioned smart contract security as one of the main issues alongside privacy, consensus, and scalability.?

Some developers suggest Artificial Intelligence will help fix DeFi smart contract issues, but then again, isn’t AI human-made? Does seem like the cycle will continue, or even worse, persist.

The Ethereum community has been proactive in addressing these issues. Tools like EVMFuzzer have been developed to detect vulnerabilities via fuzz testing, thus ensuring better security.

While the EVM is a powerful tool, it's only as effective as the security measures developers put in place.?

Necessity is the mother of invention, and I believe most of us think it’s more than necessary for Ethereum to address its smart contract issue, although it is easier said than done.