Designing Blockchain Systems: What Smart Contract Tutorials Don’t Tell You (Part 2)

System-level risks in smart contract engineering go far beyond writing safe Solidity code. Key failure points include MEV and sandwich attacks requiring slippage protection, flash loan exploits that assume atomic access to large capital, fragile oracle designs that trust manipulable spot prices instead of TWAP, non-uniform ERC token behaviors (ERC777 hooks, rebase tokens, approval race conditions), signature replay and domain separation issues with EIP-712 and EIP-2612, proxy upgrade pitfalls like storage collisions and unprotected initializers, and operational safeguards like circuit breakers and rate limiting. The core message is that a contract can be individually correct yet fail catastrophically when interacting with real markets, tokens, and adversarial actors.