TL;DR Breakdown
- According to DeFi Pulse, there is around $100 billion locked up in DeFi.
- In 2020, around $120 million was lost to DeFi hacks
Decentralized Finance deals with a decentralized ledger and lacks intermediaries, making it quite favorable but also risky. According to DeFi Pulse, there is around $100 billion locked up in DeFi. As the total value increases, so does the crime rate around it. Hackers have taken up the opportunity to loot investors as the business is booming.
Nevertheless, more measures have been taken to ensure the safety of investors’ assets. In 2020, around $120 million was lost to hackers. This year, the number is probably going to be much smaller, taking the current statistics.
Funds are swindled from the system by use of hacks, rug pulls, and system failure. However, these are vital areas that the platforms have decided to put significant concerns on to curb the crime. These are some of the biggest hacks that have taken place this year.
Significant DeFi hacks in 2021
Yearn finance flash loan attack
The attack on the platform happened in February this year. The hackers siphoned $11 million and managed to get away with $2.7 million as profit. They used $8.5 million as fees. The hackers used flash loans which they used to make a collateralized loan. The hacker then made a deposit in Yearns pool, which led to an inflation of DAI.
EasyFi hack
Monday 19th of April this year, a cyptojacking happened to EasiFi. The platform sits atop of the Polygon Network. A loss of $80 million worth of assets was lost to a strategic hack. The hackers took 75 million USD as assets and siphoned 6 million USD from liquidity pools. To recover the loss and prevent future similar attacks, the managing team altered the blockchain network protocol.
PAID Network major loss
The PAID network suffered a significant loss of around 180 million USD. Hackers managed impunity of 3 million USD. As if that’s not enough, the hackers minted PAID tokens worth above 180 million USD. It caused inflation in the supply of the tokens, which led to a drop in their value by about 85%. While some argue that the attack might have been a rug pull and not a hack, there are no facts attached to the claim.
Uranium Finance Token migration hack
An attack on the Binance Smart Chain network-based platform, Uranium Finance, happened during a token migration event earlier in the year. It was focused on BSC’s automated market protocol. The hacker managed to get away with 50 million USD after taking advantage of a coding error. He liquefied the process without revealing his identity.
Spartan Flash Loans hack
The Spartan protocol is also a BSC-based platform that suffered a hack in May this year. The project lost 30 million USD taken out by flash loans from PanCake. He altered the balance of assets that were locked in the liquidity pool. He withdrew the stolen funds by use of DEXs 1inch and Nerve Finance.
DeFi platforms should heighten their security measures since DeFi hacks perpetrators are busy developing better ways to manipulate loopholes in finance to their favor.
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