However, let us not forget what ethereum, long ago, claimed, and was its raison-d-existence: "smart contracts".
They said all over that the usual way of making human contracts, where there's the letter of the contract, and then, the whole environment, that will judge over exactly what that letter of the contract means, in the frame of the law, habits, and a general feeling of what is just, IS NOW OUTDATED, because we have "smart contracts".
In smart contracts, they said, "the code is the law, and nothing but the law". This was the innovative thing of ethereum: the code is the law and there is NO ROOM FOR HUMAN INTERPRETATION. No dispute possible: you run the code of the contract, and it says what should happen, and makes it happen. If you do not agree, then that's your problem, you had to read the code, which is the contract, the full contract and nothing else is the contract. And NOTHING WILL EVER STOP a contract from doing what it was written to do. It were *unstoppable contracts*.
Well, as you can imagine, with a new, Turing complete language, people didn't really *understand* exactly what the code actually meant. So a lot of "smart people" signed up to the DAO, a super-duper smart contract that was going to play venture capitalist. It said all over "the code is the law". All these people "invested" in that contract, signing up to it, and to the claim that the code was going to be the law.
Essentially, the DAO was a big fund, that could release part of these funds to undertakings the holders voted over, with a lot of complicated gouvernance rules.
And then, a guy really looked at the code, and understood that the code allowed him to get most of the funds out of the contract using these governance rules. And he did exactly that: he used the code, which was the sole law, remember, to give him part of the funds in the DAO. He didn't "hack" anything. He used the contract as it was written down, and on who everybody had agreed that it was the law.
But the "law" was different than what people, who didn't really understand the code, thought it was.
So they panicked. They said that this was not "meant to be that way". That the code is the law, unless one doesn't agree with it. So then people started calling that person, who got the funds according to the "laws of the contract", a thief. A criminal. A hacker. While the only thing that he did, was to apply fully the adagio of ethereum: the code is the law.
He didn't modify the code, he didn't break into any computer, he simply USED the contract as it was written down. And that contract said that he could have the funds. Even though this is not what people thought that the contract said. Maybe (not sure) not even its authors.
So then, totally panicked, the only thing that the ethereum foundation did, was to "turn back the block chain" with a hard fork. The actions of the contract were stopped, and reversed by the hard fork.
Some people, a minority, thought that this killed the essential notion of ethereum, which was based upon the notion of smart contract, and the two fundamental axioms:
- the code is the law, and the sole law: if the code does it, that's what should be done
- a contract is unstoppable.
Stopping a contract, reversing it, and calling someone who played by the rules, a criminal, was the worst thing that could happen to ethereum for some. So they continued with the old ethereum code: ETC was born.