The US Federal Bureau of Investigation (FBI) is taking action to educate platforms and investors about these risks as cybercrime affects the DeFi sector more and more. The FBI is also advising a set of procedures that could protect these parties from losing their money to criminals.
The bureau claimed that “cybercriminals are increasingly taking advantage of weaknesses in the smart contracts governing DeFi platforms to steal cryptocurrencies, leading investors to lose money.” Cybercriminals aim to profit from investors’ growing interest in cryptocurrencies, as well as from the open source nature of DeFi systems and the intricacy of cross-chain capabilities.
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With this in mind, the FBI recommends investors implement the following measures to protect their assets:
- before deciding on their investments, conduct in-depth study on DeFi platforms, protocols, and smart contracts and keep yourself informed of the specific hazards associated;
- certify that the chosen DeFi investing platform has completed one or more code audits that were ordered from impartial auditors;
- watch out for DeFi investment pools with extremely short join windows and quick smart contract deployment, especially without the advised code audit;
- Keep in mind the potential danger associated with using crowdsourced solutions for finding and correcting vulnerabilities.
The FBI also advises DeFi platforms to take the following security measures:
- to more quickly identify vulnerabilities and respond to signs of suspicious behaviour, adopt real-time analytics, monitoring, and thorough testing of code;
- Create and implement incident response procedures that include notifying investors of smart contract exploitation, flaws, and other observed shady activity.
According to a recent research by the blockchain monitoring firm Chainalysis, some types of cryptocurrency-based crime, such hacking and money theft, have so far become more common this year. According to the company’s analysts, a significant portion of this is due to the increase in money being stolen from DeFi protocols, a trend that started last year.
Through July 2022, USD 1.9bn worth of cryptocurrency has been stolen in hacks of services, compared to just under USD 1.2bn at the same point in 2021,” the company said.