FBI once again warns against use of DeFi platforms

The Federal Bureau of Investigation (FBI) expects and wants decentralized finance (DeFi) platforms to do more to protect investors, including the increase in security measures.

The FBI has warned investors that DeFi platforms still exhibit numerous vulnerabilities and have not reached the desired technological standard.

For one, the FBI expects DeFi platforms to stop using third parties to carry out financial transactions as that adds further issues and leads to security breaches.

DeFi platforms have suffered heavily from similar developments, including the infamous $650m Ronin hack which resulted from faulty bridge technology.

That is why the FBI strongly urges DeFi to take over its own transactions, but this is a process that usually requires more responsibility, and many companies leave it to what they believe to be trusted third party solutions.

As discussed before, the problem of the technology and its shortcomings in terms of security is that many of these platforms focus on customer acquisition and often move quicker than they can afford to protect consumers.

This has been a godsend for criminals who managed to steal $1.3bn in the first quarter of this year alone.

The FBI has been using Chainalysis, a cryptocurrency security firm to deliver on most of its conclusions, but it also works with an in-house cryptocurrency unit.

Most of the DeFi platforms who suffer at the hands of hackers are exploited through a flash loan vulnerability, the FBI confirmed.

That is why investors should be very careful and do their due diligence before putting money on DeFi platforms that may have had problems with their level of security in the past.

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Written by Alex

Alex is a well-rounded crypto writer who focuses on general market and legal developments. His main interest lies in how crypto gaming can become a more permanent part of the gaming landscape and how blockchain holds benefits to players they are not even aware of.

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