In the realm of decentralized finance (DeFi), the cumulative losses from crypto hacks and exploits have amounted to an astounding £19 billion over the past 13 years. As per a report by Crystal Intelligence, there have been 785 documented instances of hacks and exploits within the cryptocurrency industry, with the initial known hack occurring in June 2011. This concerning data brings attention to the vulnerabilities within the crypto space and underscores the imperative for heightened security measures to safeguard digital assets.
Prominent instances of theft encompass the 2019 Plus Token fraud, wherein attackers pilfered £2.9 billion worth of Bitcoin, and a 2024 security breach on PlayDapp, resulting in the theft of £290 million in digital assets. These high-profile cases function as a stark reminder of the risks linked with storing and trading cryptocurrencies.
In the interim, Michael Egorov, the founder of DeFi protocol Curve Finance, proclaimed recently that he has reimbursed 93% of a £10 million bad debt stemming from the protocol’s soft liquidation. This reimbursement comes following a successful real-world trial of Curve Finance’s soft liquidation mechanism during a recent hacking attempt. Egorov’s commitment to repaying the debt underscores his dedication to upholding the integrity of the protocol and safeguarding its users.
In a separate development, Terraform Labs has made the decision to completely cease its operations and transfer control of the Terra blockchain to the Terra community. This decision follows the company reaching a £4.47 billion settlement with the United States Securities and Exchange Commission (SEC) related to the historic collapse of the algorithmic stablecoin TerraUSD (UST) in 2022. As part of the settlement, Terraform Labs has consented to divest key projects within the Terra ecosystem and relinquish control to the community.
Moreover, the Solana Foundation has taken decisive measures against validator operators involved in sandwich attacks on traders. A sandwich attack occurs when a malicious trader manipulates the price of an asset by placing one order before a pending transaction and another immediately after, resulting in profits from the price difference. The Solana Foundation’s crackdown on these activities illustrates a commitment to upholding the integrity and security of the Solana network.
With regards to market performance, data from Cointelegraph Markets Pro and TradingView indicates that DeFi’s top 100 tokens faced a bearish week, with the majority trading in the red on the weekly charts. Nevertheless, the total value locked in DeFi protocols continues to rise, reaching £101 billion.
As we reflect on the events of this week, it is evident that the DeFi space is evolving and encountering new challenges. The surge of cryptocurrency hacks and exploits, as well as the proactive measures taken by industry leaders, underscores the ongoing necessity for robust security protocols and vigilant oversight. Stay tuned next week for further insights and developments in the rapidly evolving world of decentralized finance.