Some projects manage to recover some of their clients‘ money (based on insurance programs or reserves for these occasions), but an overwhelming majority of the money is lost forever.
Decentralized Finance (DeFi) is certainly one of the biggest advances in the cryptomaniac market in 2020, with some projects reaching very impressive numbers. However, even with the importance of this new sector and Crypto Revolt the possibilities, the losses due to hacks have also given rise to faces. There were 19 DeFi projects hacked during the year, causing a loss of well over $70 million, about $380 million, the survey was conducted by CryptoBriefing.
Most DeFi projects are open source and made by motivated teams, but not always very experienced. This ends up giving the project a code that can be exploited by malicious people. This creates an environment where hacker attacks have become commonplace and exploits end up stealing money from investors.
Far beyond exploits, there are people taking advantage of vulnerabilities in the project idea, manipulating markets for unnatural profit and often breaking the market for a currency.
Many people end up losing money (a lot of money). DeFi is very encouraging, but it is also a moment that is very reminiscent of ICO fever in 2017.
19 DeFi coins hacked in 2020
While some projects manage to recover some of their clients‘ money (based on insurance programs or bookings for these occasions) the overwhelming majority of the money is lost forever.
Among the most critical attacks are the Harvest hack, which has caused a loss of $24 million. One investor used a flashloan tactic to manipulate the market and take $24 million from the project pool. The project was even criticized for over-centralizing the network, and the hacker even returned some of the stolen money.
In April another large-scale attack took place on the Lendf.me loan platform, linked to the Chinese DeFI dForce platform. Using a known vulnerability in the Ethereum protocol, the hacker was able to steal $25 million. This vulnerability was the same one used in the DAO hacker attack in 2016.
Another devastating case was SharkTron, with estimated (but unconfirmed) losses of $260 million. SharkTron is a DeFi platform with a liquidity pool in Tron. On November 9th they announced an incident on the platform warning that the stolen values were blocked at Binance.
Check out the other hacked projects:
bZx – US$ 954,000
Hegic – US$4 8,000
Maker – US$8 million
Argent – US$ 0 – Attack by a White hat hacker
Bancor – $ 0 – Attack by a White hat hacker
Balancer – US$ 500,000
Uniswap – US$ 530,000
Opyn – US$ 370,000
YAM – US$ 750,000
Soft Yearn – US$ 250,000
bZx (again) – US$ 8 million
Lien – US$ 0 – also performed by a hacker White hat
Eminence – US$ 15 million
UniCats – US$ 140,000
Akropolis – US$ 2 million