Investors are being warned by the FBI that hackers are increasingly using Decentralized Finance (DeFi) platform security flaws to steal cryptocurrency.
According to the PSA, which was posted on the FBI's Internet Crime Complaint Center (IC3) today, nearly 97% of the $1.3 billion in bitcoin that was stolen between January and March 2022 came via DeFi sites. This represents a big increase from 72% in 2021 and roughly 30% in 2020, according to projections by the FBI.
The FBI urges people to be aware of the hazards, seek professional assistance if they are unsure, and research the security and general business practices of DeFi providers. Additionally, we all refer to DeFi providers as exchanges, markets, and other websites where you may buy, sell, trade, and borrow bitcoins and other digital assets.
The FBI's warning is due to a Chainalysis analysis from April that revealed how, per Q1 2022 statistics, DeFi cryptocurrency platforms are currently more targeted than ever.
In the majority of occurrences, the hackers rely on using security flaws in their platform's code or unauthorized access to drain cryptocurrency to addresses under their command.
According to Chainalysis, the threat actors responsible for these attacks used dangerous laundering services, like unlawful exchanges and coin tumblers on the dark web, to re-launder the majority of the stolen funds in 2022.
The FBI's alert provides investors with guidance that begins with basic cautions about performing due diligence before investing and then suggests the following:
Before investing, research DeFi platforms, protocols, and smart contracts and be aware of the dangers associated with DeFi investments.
Verify whether the DeFi investment platform has undergone one or more code audits done by impartial auditors. A code audit normally entails carefully examining and studying the platform's underlying code to find any flaws or vulnerabilities that might impair the platform's functionality.
Be wary of DeFi investment pools with short join windows and quick smart contract rollouts, especially if they don't perform the advised code audit.
Be mindful of the potential risks crowdsourced solutions pose for finding and patching vulnerabilities. Open source code repositories give anyone, even those with malicious intent, unauthorized access.
This year, no DeFi-taken monies have been reimbursed, indicating that attackers are less interested in protecting their stolen assets than they were in 2021 when almost 25% of all cryptocurrency stolen via DeFi platforms was eventually recovered and given to the victims.
The FBI established a link between the Lazarus and BlueNorOff (also known as APT38) North Korean threat organizations and the April attack of Axie Infinity's Ronin network bridge, now the largest crypto hack ever.
The $611 million breach of the decentralized merge protocols and network Poly System in August 2021 was the most significant cryptocurrency theft to date.
