Decentralized Finance has been a target for many hackers since its inception. These smart contracts are constantly exploited due to the enormous amount of digital currencies locked in them.
In just this year, over $1.7bn in crypto assets has been stolen through flaws in smart contracts. Even in the face of such attacks, DeFi continues to grow due to the lucrative offers it delivers to its users.
According to DeFi Pulse, which monitors smart contracts of DeFi protocols, there are over $100bn currently locked in smart contracts. With that much at risk, there is a huge need for additional security.
Immunefi is a project that helps find exploits – before hackers do. It uses bug bounties to pay researchers, security experts, and white hat hackers to search for exploits and save users.
The workers are often paid very well, with some even receiving a percentage of what they could have exploited.
Recently Polygon, a DeFi blockchain, offered a $2m bounty to a white hat hacker who found an exploit that would have put $850m in digital currencies at risk.
Immunefi states that it is already protecting over $80bn in user funds, and has paid out $7.5m in bounties so far.
Immunefi works with platforms like Synthetix, Chainlink, SushiSwap, PancakeSwap, Nexus Mutual, Cream Finance, 1inch, Compound, Bancor, Alchemix, and more.
DeFi platforms regularly get their smart contracts audited for security flaws but many still fail. There are different levels of security audits that can be done, and many companies opt for cheaper services.
With the level of threat these platforms are seeing, it is crucial for them to take advantage of all options available for user security.
Typically, any platform that is exploited doesn't ever tend to recover as the trust of its users diminishes. As the industry matures and the community surrounding these platforms expand, there is a likelihood to see hacking slow down, as many exploits are patched.
Decentralized finance is an incredible opportunity to revolutionize the financial industry and it is imperative to boost security in order to survive.