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digital
daily

digital daily: The Price of Nothing

The Price of Nothing: Gas was expensive for a while, both on the pump and on the blockchain. Behavior adjusts. Fewer trips to the grocer. Compromise. Optimization. Last week’s $160M hack of Wintermute, one of the leading digital asset HFTs, was the byproduct of gas optimization in digital form. How? Zeros are the cheapest number to a computer, a base state requiring minimal energy. This concept has been around since 1899 – the Hamming weight. The metric only matters deep in binary code, quantifying a number's \"distance\" from zero. The closer to zero, the cheaper it is to handle. The address 0x00000000B6AA57647B… is ~5% cheaper in gas because it has eight leading zeros than 0xAF51A75BB6AA57647B.... Wintermute used software to generate addresses with leading zeros for efficiency. But more zeros also mean less randomness. Cryptographic security works because keys are hidden by probability, like the exact coordinates of a baseball floating in the known universe. Nearly invisible. Keys for a typical random address would take over a trillion years to guess by brute force. Clues, like eight leading zeros, shrink the search space from infinite to finite, making it easier to find the keys using modern computers. Expensive, but doable if the payoff is high. In an unfortunate twist, the address-generating software used by Wintermute had an additional flaw, discovered by the team at 1inch, making the keys even easier to crack. Reducing the Hamming weight of an address is deeply technical, but it's also fundamental. Efficiency is built ground-up, often by little tweaks that play with immovable physics and quirks of math. Layer upon layer of optimizations build amazing machines. Force multipliers. However, shortcuts often have two sides – efficiency and risk. That is cryptography in a nutshell. Security is expensive.

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