Compromised Twitter OAuth Keys
OAuth distinguishes between confidential and public clients. Applications that you can publicly download on your own device (mobile or not) fall in the public category because they are subject to their embedded secret being reverse engineered as probably happened in this case. This incident is a good illustration of the fact that client secrets should not form the basis of a secure session in public clients like mobile applications because, well, those secrets are easily discovered. Twitter may create new keys for their application and look for ways to better obfuscate them but it’s only a matter of time before these new secrets are also compromised.
As I was discussing at Cloud Security Alliance and in our last tech talk, authentication involving redirection between applications on mobile device has its risks. There are ways to completely secure this between applications of a same domain but solving this across 3rd party mobile apps, in a fool-proof way requires either something like a multi-factor authentication or the provisioning of client secrets post-application download which is often not practical.
Either way, API and application providers would do well not relying on pseudo-secrets embedded in publicly available applications as the basis of any security. In the case of client applications issued by the same provider as the API they consume (e.g. the official twitter app), the password grant type make a lot more sense to me and provides a better UX.