In November 2017, the Parity Wallet freeze became one of the most shocking incidents in Ethereum's history. Due to a coding error and the actions of a single user, hundreds of millions in ETH were permanently locked.
What is Parity Wallet?
Parity Technologies developed Ethereum client software and wallet tools, including multi-signature wallets used by major ICOs and projects. These wallets were filled with ETH raised during the 2017 ICO boom.
Causes of the Freeze
On November 6, 2017, a GitHub user named 'devops199' accidentally triggered a critical flaw in the smart contract's library. They called a kill() function, which caused the code used by hundreds of other Parity multisig wallets to self-destruct. As a result, over 513 wallets lost access to 513,774.16 ETH, worth over $280 million at that time.
Industry Consequences and Lessons Learned
Affected projects included Polkadot, Edgeless, and Swarm City. The community debated whether a hard fork should be proposed to recover the funds, but this was rejected due to concerns about network immutability. The incident heightened awareness of smart contract audits and safer multisig protocols. Subsequently, Parity Technologies focused on the development of Polkadot.
The Parity Wallet freeze incident serves as a cautionary tale: even trusted teams can deploy flawed code, and one line of Solidity can lock away millions. It reminds all blockchain participants that decentralization requires a high level of responsibility.
