14 Things About Smart Contract Audit You May Not Have Known
Whether you are starting an Ethereum development project or exploring decentralized exchange development, you need to audit your code before deploying it.
Here are 14 things about Smart Contract Auditing that you may not know.
1. Smart Contract Audits Protect Your Organization
Blockchain technology offers many advantages, including the use of smart contracts to simplify transactions. However, smart contracts contain certain vulnerabilities. The digital contract relies on a blockchain or distributed ledger, which remains visible to all parties involved with the contract.
2. Smart Contracts Face a Variety of Vulnerabilities
The potential vulnerabilities of your smart contract may expose you to a higher risk of malicious attack. Some of the most common smart contract vulnerabilities include:
- Reentrancy attacks
- Replay attacks
- Short address attacks
- Reordering attacks
Automated and manual testing helps detect these issues during the smart contract development process. Catching security flaws before deployment helps prevent mistakes that you cannot reverse, including the loss of asset tokens.
3. Some Audits Only Take a Few Days to Complete
Many organizations assume that an audit takes a considerable amount of time to complete. The duration depends on the scale of the contract and the type of smart contract audit. For example, with a basic EOS development project, the audit may only take a few days. However, complex real estate tokenization may take up to a month.
4. A Typical Audit Has Four Primary Steps
Reliable smart contract audit development companies complete four phases during the auditing process:
The final report includes details related to the audit, including information about the changes made and security flaws detected.
5. Smart Contract Audit Include Testing
Testing is an essential part of any cryptocurrency development lifecycle. Without testing, you may not detect errors in the code and other issues that occur during the cryptocurrency or digital wallet development process.
The two types of testing include automated and manual analysis.
6. Automated Auditing Helps Detect Bugs
After the blockchain proof of concept stage, your team may start coding the smart contracts. This is where most errors occur. Automated auditing helps find common vulnerabilities in the code.
7. Manual Auditing Verifies Detected Bugs
While automated auditing offers several benefits, it occasionally leads to false positives, as the tools cannot analyze the developer’s intention. A manual audit helps verify bugs and detect issues that the automated process may overlook.
8. Large Structural Changes May Require a New Audit
Most auditors recommend that you get an audit of your smart contract after any major structural changes.
If you get the audit too early, later changes may require the need for a new audit. To avoid this problem, begin the auditing process near the end of the development cycle.
9. Smart Contract Provide Transparency
Using a smart contract provides greater transparency, as all parties involved in the process can view and review the transactions. With a secure, decentralized contract, you have less risk of miscommunication and conflicts.
10. A Secure Smart Contract Saves Time
With a detailed audit, you ensure that your contract does not contain any errors. This allows you to enjoy the time-saving benefits of smart contracts.
Instead of dealing with large amounts of paperwork and administrative processes that typically slow down contracts, smart contracts complete the process automatically.
11. Smart Contract Can Provide Greater Security
Compared to standard contracts, smart contracts have the potential to provide greater security. However, vulnerabilities still exist, which is why you should always schedule an audit before deploying your smart contract.
12. You Receive a Detailed Smart Contract Audit Report
After the auditors complete the final testing, they compile a report for you to review. The detailed technical/security audit report includes information related to any vulnerabilities uncovered and recommendations for addressing potential security issues.
13. Audit May Save You From Major Financial Losses
As the audit may help detect bugs and other vulnerabilities, it may save your organization from potential attacks. Hackers try to exploit security issues in smart contracts to siphon funds.
Instead of falling prey to one of these attacks, you can use an audit to find and resolve potential threats.
14. You Should Only Hire Trusted Independent Auditors
Always entrust reliable smart contract audit development companies to complete your independent audit. While an internal audit may help uncover vulnerabilities, independent audits provide an unbiased review of your code.
To ensure stable coin development, you need secure smart contracts. Smart contract audits help detect any issues that impact the security of your blockchain project.
If you want to protect your assets and make your investors or clients happy, schedule a detailed audit for your smart contract. You may also use blockchain proof of concept services to help develop your project from the start, reducing the risk of potential security flaws.
Ish Goel established the ‘Blockchain Centre of Excellence’ at Somish in 2016. Through the Somish Group, he has worked with the Government, Real Estate, BFSI, Manufacturing, Retail, Agriculture and Logistics industry over the past one decade.
Ish is one of the key blockchain architects at Somish and has led delivery of multiple blockchain products using platforms like Ethereum and Hyperledger globally. Key product offerings include: DEF (Data Exchange Framework powered by blockchain, getdef.io), GovBlocks (Decision Making Protocol, govblocks.io) and Certy (Issue Certificates on Blockchain, certy.io)