The DeFi space, infamous for its volatility, is unfortunately now known for its series of increasing hacks. In the past month, various firms throughout the DeFi market have been hit with a relentless barrage of attacks, with each one more expensive than the last.
Each hack managed to steal millions from its targets and managing to make conditions in the bear market even worse. Investors are scared of the current conditions of the market, as they don’t want to fall victim to a major hack.
In fact, in just this year alone, the DeFi space has managed to lose over $3 billion in this year alone to different hacks. And with new companies trying to make their way into the DeFi space, they now have to contend with the possibility that they could also be a victim of a serious hack.
In fact, hacking activity has risen to such an extent this year that it will easily surpass 2021 as the biggest year for hackers. Over the past month alone, 11 different hacks have crippled various DeFi platforms.
High Activity Despite the Bear Market
Throughout the last year, it became obvious that hacking in the crypto space was going to become a more common issue. Not only did it mean that all of the crypto firms would have to prepare better, but the hacks made more sense since the market was also doing fairly well.
However, in the case of this year specifically, hacks have started to increase despite the market seeing some of the worst bearish conditions imaginable. While they stopped during the summer, they have started picking up steam in recent years, and hackers are showing no signs of stopping.
DeFi Protocols with Little to no Auditing
As of now, one of the biggest problems that the current market is currently facing is a general lack of auditing. Companies without proper audits make for very easy prey for these hackers. These low-hanging fruits are a great way for most firms to make a small but easy profit.
But with proper auditing standards, the risk of these hacks can fall significantly.
Comparing the Previous Year of Hacks to this One
2021 saw some major cryptocurrencies lose large chunks of their market cap to hackers. In fact, the entire market lost as much as $3.2 billion to hackers. The biggest hack of the time was the Poly Network, which managed to lose about $613 million is a single swing.
However, compared to this year, all of these hacks have still pale in comparison, as Axie Infinity’s Ronin bridge saw the company lose $625 million, and the market has lost over $3 billion throughout the year already.