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What are Decentralised Autonomous Organizations (DAOs)?

A Decentralised Autonomous Organisation or a DAO, is a unique take on democracy on the blockchain. It is a set of rules encoded into a self-executing contract (also known as a smart contract) that operates autonomously on a blockchain system. A DAO imitates a traditional company, although, in its more literal sense, it is a contractually created entity. In theory, DAOs have no centralised authority in making decisions for the system; it is a communally run system whereby all decisions (be it for internal governance or for the development of the blockchain system) are voted upon by the community members. DAOs are primarily characterised by a decentralised form of operation, where there is no one entity, group or individual running the system. They are self-sustaining entities, having their own currency, economy and even governance, that do not depend on a group of individuals to operate. Blockchain systems, especially DAOs are characterised by pure autonomy created to evade external coercion or manipulation from sovereign powers. DAOs follow a mutually created, agreed set of rules created by the community, that dictates all actions, activities, and participation in the system’s governance. There may also be provisions that regulate the decision-making power of the community.

Ethereum’s DAO’s White Paper described DAO as “The first implementation of a [DAO Entity] code to automate organisational governance and decision making.” Can be used by individuals working together collaboratively outside of a traditional corporate form.  It can also be used by a registered corporate entity to automate formal governance rules contained in corporate bylaws or imposed by law.”  The referred white paper proposes an entity that would use smart contracts to solve governance issues inherent in traditional corporations.  DAOs attempt to redesign corporate governance with blockchain such that contractual terms are “formalised, automated and enforced using software.”

Cybersecurity threats under DAOs

While DAOs offer increased transparency and efficiency, they are not immune to cybersecurity threats. Cybersecurity risks in DAO, primarily in governance, stem from vulnerabilities in the underlying blockchain technology and the DAO's smart contracts. Smart contract exploits, code vulnerabilities, and weaknesses in the underlying blockchain protocol can be exploited by malicious actors, leading to unauthorised access, fund manipulations, or disruptions in the governance process. Additionally, DAOs may face challenges related to phishing attacks, where individuals are tricked into revealing sensitive information, such as private keys, compromising the integrity of the governance structure. As DAOs continue to evolve, addressing and mitigating cybersecurity threats is crucial to ensuring the trust and reliability of decentralised governance mechanisms.

Centralisation/Concentration of Power

DAOs today actively try to leverage on-chain governance, where any governance votes or transactions are directly taken on the blockchain. But such governance is often plutocratic in nature, where the wealthy hold influences, rather than democracies, since those who possess the requisite number of tokens are only allowed to vote and each token staked implies that many numbers of votes emerge from the same individual. This concentration of power in the hands of “whales” often creates disadvantages for the newer entrants into the system who may have an in-depth background but lack the funds to cast a vote. Voting, presently in the blockchain sphere, lacks the requisite concept of “one man, one vote” which is critical in democratic societies.

Smart contract vulnerabilities and external threats

Smart contracts, self-executing pieces of code on a blockchain, are integral to decentralised applications and platforms. Despite their potential, smart contracts are susceptible to various vulnerabilities such as coding errors, where mistakes in the code can lead to funds being locked or released erroneously. Some of them have been mentioned as follows;

Smart Contracts are most prone to re-entrance attacks whereby an untrusted external code is allowed to be executed in a smart contract. This scenario occurs when a smart contract invokes an external contract, and the external contract subsequently re-invokes the initial contract. This sequence of events can lead to an infinite loop, and a reentrancy attack is a tactic exploiting this vulnerability in a smart contract. It enables an attacker to repeatedly invoke a function within the contract, potentially creating an endless loop and gaining unauthorised access to funds.

Additionally, smart contracts are also prone to oracle problems. Oracles refer to third-party services or mechanisms that provide smart contracts with real-world data. Since smart contracts on blockchain networks operate in a decentralised, isolated environment, they do not have direct access to external information, such as market prices, weather conditions, or sports scores. Oracles bridge this gap by acting as intermediaries, fetching and delivering off-chain data to smart contracts, enabling them to execute based on real-world conditions. The oracle problem within blockchain pertains to the difficulty of securely incorporating external data into smart contracts. The reliability of external data poses a potential vulnerability, as oracles may be manipulated or provide inaccurate information. This challenge jeopardises the credibility of blockchain applications that rely on precise and timely external data.

Sybil Attack: A Sybil attack involves a single node managing multiple active fake identities, known as Sybil identities, concurrently within a peer-to-peer network. The objective of such an attack is to weaken the authority or influence within a trustworthy system by acquiring the majority of control in the network. The fake identities are utilised to establish and exert this influence. A successful Sybil attack allows threat actors to perform unauthorised actions in the system.

Distributed Denial of Service Attacks: A Distributed Denial of Service (DDoS) attack is a malicious attempt to disrupt the regular functioning of a network, service, or website by overwhelming it with a flood of traffic. In a typical DDoS attack, multiple compromised computers or devices, often part of a botnet (a network of infected machines controlled by a single entity), are used to generate a massive volume of requests or data traffic. The targeted system becomes unable to respond to legitimate user requests due to the excessive traffic, leading to a denial of service.

Conclusion

Decentralised Autonomous Organisations (DAOs) represent a pioneering approach to governance on the blockchain, relying on smart contracts and community-driven decision-making. Despite their potential for increased transparency and efficiency, DAOs are not immune to cybersecurity threats. Vulnerabilities in smart contracts, such as reentrancy attacks and oracle problems, pose significant risks, and the concentration of voting power among wealthy token holders raises concerns about democratic principles. As DAOs continue to evolve, addressing these challenges is essential to ensuring the resilience and trustworthiness of decentralised governance mechanisms. Efforts to enhance security measures, promote inclusivity, and refine governance models will be crucial in establishing DAOs as robust and reliable entities in the broader landscape of blockchain technology.

References:

‍https://www.imperva.com/learn/application-security/sybil-attack/

‍https://www.tripwire.com/state-of-security/blockchain-security-understanding-vulnerabilities-and-mitigating-risks

‍https://medium.com/@RedStone_Finance/the-oracle-problem-and-its-implications-for-blockchains-c0c0ad9cf5a7

‍https://www.linkedin.com/posts/satish-kulkarni-bb96193_what-are-cybersecurity-risk-to-dao-and-how-activity-7048286955645677568-B3pV/ https://www.geeksforgeeks.org/what-is-ddosdistributed-denial-of-service/ Report of Investigation Pursuant to Section 21 (a) of the Securities Exchange Act of 1934: The DAO, Securities and Exchange Board, Release No. 81207/ July 25, 2017

‍https://www.sec.gov/litigation/investreport/34-81207.pdf https://www.legalserviceindia.com/legal/article-10921-blockchain-based-decentralized-autonomous-organizations-daos-.html

Introduction

India's Computer Emergency Response Team (CERT-In) has unfurled its banner of digital hygiene, heralding the initiative 'Cyber Swachhta Pakhwada,' a clarion call to the nation's citizens to fortify their devices against the insidious botnet scourge. The government's Cyber Swachhta Kendra (CSK)—a Botnet Cleaning and Malware Analysis Centre—stands as a bulwark in this ongoing struggle. It is a digital fortress, conceived under the aegis of the National Cyber Security Policy, with a singular vision: to engender a secure cyber ecosystem within India's borders. The CSK's mandate is clear and compelling—to detect botnet infections within the subcontinent and to notify, enable cleaning, and secure systems of end users to stymie further infections.

What are Bots?

Bots are automated rogue software programs crafted with malevolent intent, lurking in the shadows of the internet. They are the harbingers of harm, capable of data theft, disseminating malware, and orchestrating cyberattacks, among other digital depredations.

A botnet infection is like a parasitic infestation within the electronic sinews of our devices—smartphones, computers, tablets—transforming them into unwitting soldiers in a hacker's malevolent legion. Once ensnared within the botnet's web, these devices become conduits for a plethora of malicious activities: the dissemination of spam, the obstruction of communications, and the pilfering of sensitive information such as banking details and personal credentials.

How, then, does one's device fall prey to such a fate? The vectors are manifold: an infected email attachment opened in a moment of incaution, a malicious link clicked in haste, a file downloaded from the murky depths of an untrusted source, or the use of an unsecured public Wi-Fi network. Each action can be the key that unlocks the door to digital perdition.

In an era where malware attacks and scams proliferate like a plague, the security of our personal devices has ascended to a paramount concern. To address this exigency and to aid individuals in the fortification of their smartphones, the Department of Telecommunications(DoT) has unfurled a suite of free bot removal tools. The government's outreach extends into the ether, dispatching SMS notifications to the populace and disseminating awareness of these digital prophylactics.

Stay Cyber Safe

To protect your device from botnet infections and malware, the Government of India, through CERT-In, recommends downloading the 'Free Bot Removal Tool' at csk.gov.in.' This SMS is not merely a reminder but a beacon guiding users to a safe harbor in the tumultuous seas of cyberspace.

Cyber Swachhta Kendra

The Cyber Swachhta Kendra portal emerges as an oasis in the desert of digital threats, offering free malware detection tools to the vigilant netizen. This portal, also known as the Botnet Cleaning and Malware Analysis Centre, operates in concert with Internet Service Providers (ISPs) and antivirus companies, under the stewardship ofCERT-In. It is a repository of knowledge and tools, a digital armoury where users can arm themselves against the specters of botnet infection.

To extricate your device from the clutches of a botnet or to purge the bots and malware that may lurk within, one must embark on a journey to the CSK website. There, under the 'Security Tools' tab, lies the arsenal of antivirus companies, each offering their own bot removal tool. For Windows users, the choice includes stalwarts such as eScan Antivirus, K7 Security, and Quick Heal. Android users, meanwhile, can venture to the Google Play Store and seek out the 'eScan CERT-IN Bot Removal ' tool or 'M-Kavach2,' a digital shield forged by C-DAC Hyderabad.

Once the chosen app is ensconced within your device, it will commence its silent vigil, scanning the digital sinews for any trace of malware, excising any infections with surgical precision. But the CSK portal's offerings extend beyond mere bot removal tools; it also proffers other security applications such as 'USB Pratirodh' and 'AppSamvid.' These tools are not mere utilities but sentinels standing guard over the sanctity of our digital lives.

USB Pratirodh

'USB Pratirodh' is a desktop guardian, regulating the ingress and egress of removable storage media. It demands authentication with each new connection, scanning for malware, encrypting data, and allowing changes to read/write permissions. 'AppSamvid,' on the other hand, is a gatekeeper for Windows users, permitting only trusted executables and Java files to run, safeguarding the system from the myriad threats that lurk in the digital shadows.

Conclusion

In this odyssey through the digital safety frontier, the Cyber Swachhta Kendra stands as a testament to the power of collective vigilance. It is a reminder that in the vast, interconnected web of the internet, the security of one is the security of all. As we navigate the dark corners of the internet, let us equip ourselves with knowledge and tools, and may our devices remain steadfast sentinels in the ceaseless battle against the unseen adversaries of the digital age.

References

• https://timesofindia.indiatimes.com/gadgets-news/five-government-provided-botnet-and-malware-cleaning-tools/articleshow/107951686.cms
• https://indianexpress.com/article/technology/tech-news-technology/cyber-swachhta-kendra-free-botnet-detection-removal-tools-digital-india-8650425/

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Introduction

The Ministry of Electronics and Information Technology recently released the IT Intermediary Guidelines 2023 Amendment for social media and online gaming. The notification is crucial when the Digital India Bill’s drafting is underway. There is no denying that this bill, part of a series of bills focused on amendments and adding new provisions, will significantly improve the dynamics of Cyberspace in India in terms of reporting, grievance redressal, accountability and protection of digital rights and duties.

What is the Amendment?

The amendment comes as a key feature of cyberspace as the bill introduces fact-checking, a crucial aspect of relating information on various platforms prevailing in cyberspace. Misformation and disinformation were seen rising significantly during the Covid-19 pandemic, and fact-checking was more important than ever. This has been taken into consideration by the policymakers and hence has been incorporated as part of the Intermediary guidelines. The key features of the guidelines are as follows –

• The phrase “online game,” which is now defined as “a game that is offered on the Internet and is accessible by a user through a computer resource or an intermediary,” has been added.
• A clause has been added that emphasises that if an online game poses a risk of harm to the user, intermediaries and complaint-handling systems must advise the user not to host, display, upload, modify, publish, transmit, store, update, or share any data related to that risky online game.
• A proviso to Rule 3(1)(f) has been added, which states that if an online gaming intermediary has provided users access to any legal online real money game, it must promptly notify its users of the change, within 24 hours.
• Sub-rules have been added to Rule 4 that focus on any legal online real money game and require large social media intermediaries to exercise further due diligence. In certain situations, online gaming intermediaries:

• Are required to display a demonstrable and obvious mark of verification of such online game by an online gaming self-regulatory organisation on such permitted online real money game
• Will not offer to finance themselves or allow financing to be provided by a third party.
• Verification of real money online gaming has been added to Rule 4-A.

• The Ministry may name as many self-regulatory organisations for online gaming as it deems necessary for confirming an online real-money game.
• Each online gaming self-regulatory body will prominently publish on its website/mobile application the procedure for filing complaints and the appropriate contact information.
• After reviewing an application, the self-regulatory authority may declare a real money online game to be a legal game if it is satisfied that:

• There is no wagering on the outcome of the game.
• Complies with the regulations governing the legal age at which a person can engage into a contract.
• The Information Technology (Intermediary Guidelines and Digital Media Ethics Code) Rules, 2021 have a new rule 4-B (Applicability of certain obligations after an initial period) that states that the obligations of the rule under rules 3 and 4 will only apply to online games after a three-month period has passed.
• According to Rule 4-C (Obligations in Relation to Online Games Other Than Online Real Money Games), the Central Government may direct the intermediary to make necessary modifications without affecting the main idea if it deems it necessary in the interest of India’s sovereignty and integrity, the security of the State, or friendship with foreign States.
• Intermediaries, such as social media companies or internet service providers, will have to take action against such content identified by this unit or risk losing their “safe harbour” protections under Section 79 of the IT Act, which let intermediaries escape liability for what third parties post on their websites. This is problematic and unacceptable. Additionally, these notified revisions can circumvent the takedown order process described in Section 69A of the IT Act, 2000. They also violated the ruling in Shreya Singhal v. Union of India (2015), which established precise rules for content banning.
• The government cannot decide if any material is “fake” or “false” without a right of appeal or the ability for judicial monitoring since the power to do so could be abused to thwart examination or investigation by media groups. Government takedown orders have been issued for critical remarks or opinions posted on social media sites; most of the platforms have to abide by them, and just a few, like Twitter, have challenged them in court.

Conclusion

The new rules briefly cover the aspects of fact-checking, content takedown by Govt, and the relevance and scope of sections 69A and 79 of the Information Technology Act, 2000. Hence, it is pertinent that the intermediaries maintain compliance with rules to ensure that the regulations are sustainable and efficient for the future. Despite these rules, the responsibility of the netizens cannot be neglected, and hence active civic participation coupled with such efficient regulations will go a long way in safeguarding the Indian cyber ecosystem.