how should Ethereum fix this?
A $50 million heist calls a new virtual currency into question. What should Ethereum do about it?
Jessi Hempel

If ether is returned to the DAO investors, Ethereum sets the example that they look after smart-contract investors. Maybe this will encourage crypto-currency adoption?

However, a down-side to returning ether is that future speculators may expect compensation if their future bets go bad. A rift in the community could develop as there’d be a perceived double standard of Ethereum developers who invested in the DAO able to get consensus and being reimbursed, but not bailing out other failing investments.

Another down-side is that bailing out investors will most certainly result in a selloff of ether, as many would convert some or all of their returned investments to harder assets. This punishes the people of the Ethereum community who didn’t invest in the DAO.

The hacker holding so many ether is a problem for Ethereum’s future, so the fair play would be to destroy the stolen ether. This way there is no conflict of interest / double standard for the developers to grapple with in future hacks and DAO investors will learn to be more careful with their money.

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