Ethereum has figured out how to prevent hacks of DeFi protocols
Date: 2023-07-05 Author: Karina Ziganova Categories: IN WORLD
Members of the Ethereum community have proposed a new standard to improve the security of decentralized finance (DeFi) protocols.
The new standard is called ERC (Ethereum Request for Comments) 7265. It will work as a "circuit breaker", allowing DeFi protocols to easily add a lock to their smart contracts that stops tokens before they leave contracts in the event of a hack.
"We all agree that DeFi doesn't work," Meir told Bank of Fluid Protocol. "Not only are there a lot of hacks, but the results are catastrophic. When protocols are hacked, they often lose everything. TVL drops to zero in a matter of seconds," said a community member with the nickname meirbank.
According to him, in the event of a hack, the attacker will no longer be able to merge the entire contract in a matter of seconds, and the developers will be able to return most of the money.
"ERC 7265 allows teams to create circuit breakers that protect their protocol, with configurable rate limiting parameters for each asset," meirbank noted.
However, the ERC 7265 standard is now in the process of being proposed. Therefore, it remains to be seen whether the Ethereum core team will adopt it and implement it as the final standard.
According to Beosin analysts, total losses from hacks, phishing scams, and rag pulls in the first six months of 2023 reached $655.61 million; Of this amount, hackers returned about $215 million, while the vast majority of cryptocurrencies lost in the first half of 2023 — 75.6% — fell on one blockchain — Ethereum.
Over the years, the DeFi sphere has lost $76.6 billion from hacks, exploits, theft, and fraud. However, more than half of this amount comes from the collapse of the Terra/Luna ecosystem in May 2022. The biggest hack in the first half of 2023 was an attack on the Euler Finance protocol.
