This is even worse than the other scams. Bitconeect for example, was a scam you could foresee for economic and marketing reasons. But this project you would only have to know about this backdoor if you were a programmer and had read all the source code. This demonstrates how difficult it is to analyze a project even with open source.
We are very dependent on the curiosity of other people. I have never read a source code from start to finish and would have difficulty understanding something like what was done with Oyster.
Perhaps it would be very interesting to have a group of hackers whose sole purpose was to exploit flaws in those projects. Could even have a bounty paid in BTC. Certainly, those who believe exclusively in the BTC could finance something like that just for fun.
The backdoor was there for a reason. According to the PRL team the "directorship of the token contract had to remain open so that the peg could be adjusted over time".
https://medium.com/oysterprotocol/oyster-update-b813390ce10eA large portion of the tokens (5%) were held by the PRL team themselves. So the even the people that knew were not concerned.
Whenever there is a bad actor - especially if it is the founder or one of the core developers it is massively damaging to the project.
In general terms most crypto expose themselves to huge risks.
A lot of coins are copypaste from other coins.
A lot of the copypaste coins fail to update their codebase
Changes made to the code are usually done at breakneck speed and not adequately tested.
A large portion of the smart contracts are potentially vulnerable.
Forks and coinswaps by consensus can be used to potentially offset some of those issues. But forks and coinswaps cause new issues.
The BTC and Ether has already been withdrawn from Kucoin. The code worked
as designed so by rolling back the transactions - KuCoin will sustain the loss rather than the bad actor. This means that the currency is not immutable and not able to be trusted. Rolling back transactions means coins that were received in the KuCoin exchange wallet and verified as valid by the coin network are being invalidated and effectively "removed" from their wallet.
It is symilar to some of the recent 51% attacks suffered by some of the insecure low hashrate POW coins. The coins are confirmed "as designed" by the coin network nodes. The valid transactions are then invalidated by the method of the attack and the chain is replaced with the attackers version. The code worked as designed but it was exploited because there were inadequate protections by the coin network.
but will most likely be executing a contract swap on the block just prior to this all happening (e.g. All 98.5 million PRL prior to the contract vulnerability will be exchanged on a 1:1 ratio to PEARL (or something to that effect)). We will also be evaluating how we can help those that were taken advantage of from this incident.
It would be unfair to make Kucoin sustain the loss because they were sent coins that were validated by the coin network. The developers not involved in this exploit are currently in a difficult situation. The best way forward is to do a 1:1 coin swap so there is a safe contract in place.
The 1.5% of the coins exploited by the minting of the new coins has effectively cost in excess of 65% of the coin value.
The damage done is far greater than the profits gained. PRL now trades around $0.03, after diving from levels of $0.22. PRL was appreciating and even having a short-term rally when the news of smart contract abuse and exchange dumping caused irreparable damage. It turned out the Oyster Protocol founder and developer, going by the moniker “Bruno Block”, had disagreements with the project’s CEO, Bill Cordes.
https://cryptovest.com/news/developer-and-founder-tanks-oyster-protocol-prl-price-by-deliberate-dumping/Bruno posted a message here:
Bruno's message
Focus everyone:
When Oyster boomed in December I wanted to go on a huge hiring spree. I was always very product focused but people only wanted to hear about marketing. Chris Bamber approached me along with Bill. Bill turned out to be an honest and hardworking guy (as CFO), but Chris did next to nothing. I paid each member of c-suite 1 million PRL each which was evaluated at half a million dollars each.
Chris bailed on us for the exponential hiring. Why was I so pushy about hiring? Because I knew Bitcoin and all of crypto was in a bubble. I sold a lot of my own PRL and PRL for the treasury but Bill preached hesitation instead.
Then ETH went from $1200 to $200. It became difficult to keep hiring people, my plan for a large robust team of developers was blocked. I spent downtime to start healing from trauma I was going through.
Then Bill told the group that we got accepted on Binance. That’s when the problems started. The price immediately started pumping from 4c to 26c. I warned Bill against insider trading, he didn’t care. So instead of him and his VC friends dumping on you, I dumped on him.
I advise all of you to get out of crypto. Go educate yourselves about what is happening with Tether. The entire crypto sphere is a giant Ponzi scheme. I warned all of you, multiple times, in private and public, and nobody listens. Ethereum is going back to $5, if you want to sell back to a greater fool then you will only find yourself to be that fool.
https://twitter.com/Bitfinexed/https://reddit.com/r/buttcoinWhat will now happen:
Bill, you’re fired.
I am going to program the protocol on my own, gradually. If someone wants to help me they can do so free of charge. No marketing, no nonsense.
PRL will still be the valid token used by the protocol (no contract swap).
I reject the Binance listing and I don’t want Kucoin to re-activate our listings.
Focus on the storage peg, that is what brings value to the token, not your Ponzi-Shenanigans.
If you want to buy only to sell to a greater fool, then you are that greater fool. PRL and SHL are not to be listed on an exchange until they are actual functioning products. I will also consider revealing my identity over the next few days. I will be posting updates on development after I straighten out this situation.
I am now going to dump as many chat logs as I can to show what happened with Oyster.
UPDATE:
If you want to play greater-fool games with Bill and co, and there is an overwhelming vote in support for Oyster becoming a permaponzi, then I will leave you all to have fun with it.
If you want PRL to operate as I've described in the whitepaper, everyone is fired and I will slowly but surely work on the protocol and post progress publicly. The last time I hired a bunch of people and threw money at them they turned it into a circus.
However, I don't believe there will be electricity running through the power grid soon. I sent this video and others like it a long time ago to this chat:
https://www.youtube.com/watch?v=VOMWzjrRiBgGo learn about peak oil and the fractional reserve banking system. The stock shale bubble is an obfuscated means to subsidize the price of oil. In Brazil, Indonesia, and other developing nations, the price of oil is subsidized with debt directly by the government. When the debt bubble pops, the price of oil will skyrocket, trucks won't be bringing produce into your city let alone computers won't be spending energy to secure the blockchain.
I believe in Oyster as a product, but I don't believe there will be a future to host it. I will program it since the program is a promise from me, but don't complain that Oyster isn't running when a banana costs $5,000.
Anyone here who has swiped a credit card or taken an interest-bearing loan has the blood of the incoming collapse on their hands. Billions of people will die, there are massive droughts and food shortages as we speak. I've made a lot of dollars by selling PRL, I immediatelly ditched the dollars to buy real things so that I can protect myself and my family from the collapse. That's all I ever wanted, and now that I have that secured, I will deliver the protocol which I promised myself. Give me some time to get my head straight after these dramatic few days, I will gradually post progress on github.
You can also buy popcorn futures on /r/buttcoin
https://www.reddit.com/r/Oyster/comments/9stgqn/brunos_message/https://archive.fo/DXjlb![](https://ip.bitcointalk.org/?u=https%3A%2F%2Fi.imgur.com%2FGPPR72L.png&t=665&c=a_Iims5zbsa3qg)
I re arranged it a bit:
I've made a lot of dollars by selling PRL, I immediatelly ditched the dollars to buy real things so that I can protect myself and my family from the collapse. That's all I ever wanted, and now that I have that secured,
Because I knew Bitcoin and all of crypto was in a bubble. I sold a lot of my own PRL and PRL for the treasury.
In other words he sold the token he created knowing he didn’t believe in it at around $3.64 so he could later make more and dump it on from $0.24 to $0.04. I advise all of you to get out of crypto. Go educate yourselves about what is happening with Tether. The entire crypto sphere is a giant Ponzi scheme. I warned all of you, multiple times, in private and public, and nobody listens. Ethereum is going back to $5, if you want to sell back to a greater fool then you will only find yourself to be that fool.
Then ETH went from $1200 to $200.
I am going to program the protocol on my own, gradually. If someone wants to help me they can do so free of charge. No marketing, no nonsense.
I believe in Oyster as a product, but I don't believe there will be a future to host it.
In other words he sold a “dream” to others that he didn’t believe in himself so he could secure his of financial future at the expense of others he considers fools. I have a name for that - exit scammer.This reditor expressed it perfectly:
![](https://ip.bitcointalk.org/?u=https%3A%2F%2Fi.imgur.com%2FwhxjYiQ.png&t=665&c=E-3UU8VVsFLE8w)
![](https://ip.bitcointalk.org/?u=https%3A%2F%2Fi.imgur.com%2FCdxYY7z.png&t=665&c=zxqCmI2KSXp4ww)