Decentralized finance (DeFi) investors should buckle themselves up for another big year of exploits and attacks as new projects enter the market and hackers become more sophisticated.
Executives from blockchain security and auditing firms HashEx, Beosin and Apostro were interviewed for Drofaโs An Overview of DeFi Security In 2022 report shared exclusively with Cointelegraph.
The executives were asked about the reason behind a significant increase in DeFi hacks last year, and were asked whether this will continue through 2023.
Tommy Deng, managing director of blockchain security firm Beosin, said while DeFi protocols will continue to strengthen and improve security, he also admitted that โthere is no absolute security,โ stating:
โAs long as there is interest in the crypto market, the number of hackers will not decrease.โ
Deng added that many new DeFi projects โdonโt go through complete security testing before going live.”
Additionally, a significant amount of projects are now exploring the use ofย cross-chain bridges, which were a prime target for exploiters last year, leading to $1.4 billion stolen across six exploits in 2022.
The comments mirror those of blockchain security firm CertiK, who told Cointelegraph on Jan. 3 that it doesnโt โanticipate a respite in exploits, flash loans or exit scamsโ in the coming year.
In particular, CertiK noted the likelihood of โfurther attempts from hackers targeting bridges in 2023โ citing the historically high returns from attacks in 2022.
Crypto auditing firm HashEx founder and CEO, Dmitry Mishunin, said โhackers have gotten smarter, gained more experience, and learned how to look for bugs.โ
โThe crypto industry is still relatively new, and everyone is growing with each other, so itโs difficult to get too far ahead of bad actors.โ
He added the amount of value in some DeFi projects made the industry โvery attractiveโ to malicious actors, and that the number of hacks โis only going to grow going forward.โ
Mishuin said these attacks may even spread outside of DeFi, with attackers setting their sights on โcrypto exchanges and banksโ that enter the market offering โmore secure solutions for storing digital assets.โ
Related: Cryptoโs recovery requires more aggressive solutions to fraud
Smart contract security and auditing firm Apostro co-founder, Tim Ismiliaev gave a more hopeful take, however, as he expects the space to โmature over the next five years, and new best practices for securing decentralized finance protocols will emerge.โ
Too long; didnโt read
Interestingly, both Mishunin and Deng noted that many of the post-incident reports provided by blockchain security firms often fail to reach their target audience โ blockchain developers.
โThe people that read such analyses are average investors that are concerned about their money. Actual blockchain developers are too busy coding; they donโt have time to read stuff like that,โ said Mishunin.
Meanwhile, Deng said the reports are usually about โevent-based vulnerabilities and related recommendations,โ so doesnโt often help other developers as they might still be vulnerable to other exploits.
He admitted, however, that reports on โgeneral vulnerabilitiesโ in DeFi โtend to do a good job of ramping up protection.โ
โThe reentrancy vulnerabilities are now not as common as they used to be.โ
