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Wednesday, January 19, 2022

DeFi targeted by cybercriminals, losses $1.3 billion in 2021

The decentralized finance (DeFi) sector is still dependent on centralized networks, making it easier for cybercriminals to break into them. According to a report, even in the year 2021, cybercriminals broke into the centralized network with DeFi protocol. Due to this, it suffered a loss of more than $ 1.3 billion (about Rs 9,606 crore). DeFi allows financial products to be displayed on a public blockchain network. It is not regulated by the Central Bank.

In a new report, blockchain research firm CertiK has said that 44 cases of DeFi hacks caused losses of $1.3 billion (about Rs 9,606 crore) last year.

One of the reasons why DeFi systems were weak was that they worked on regulated servers rather than on a blockchain network.

The report states that centralization is contrary to the ethics of DeFi and poses security risk. Using this, not only dedicated hackers, but also insiders break into DeFi.

Most of the DeFi systems are built on the Ethereum blockchain. Their objective is to provide an autonomous and decentralized option for financial services.

The report said that the DeFi sector has achieved about $ 60 billion (Rs 4,43,310 crore) by December 2021.

At the same time, a study by analytics firm ImmuneFi has claimed that more than $10 billion (about Rs 73,885 crore) in the past one year has been subject to DeFi hacking and related scams. However, researchers also believe that the DeFi sector will become safer as its workload is shifting from servers to blockchain networks.

According to the report, the loss to the DeFi sector in the year 2021 is just 0.05 percent of the total market capitalization of crypto. The cryptocurrency market has grown to a capitalization of $3 trillion (approximately Rs 2,15,66,720 crore). This is a record in itself.

Significantly, only last month, a hack in the Decentralized Finance (DeFi) protocol caused a loss of $ 120 million. A hack attack on the decentralized finance (DeFi) protocol Badger DAO resulted in the loss of $120 million (about Rs 900 crore) worth of Bitcoin and Ethereum. The attack was detected in November.

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Damini Sharma
Experienced Senior Content Writer with a demonstrated history of working in the information technology and services industry. Skilled in SEO Copywriting, Web Content Writing, Storytelling, Blogging, and Social Media. Strong media and communication professional with a mass communication focused in Journalism from Sjmc davv indore.
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