FBI warns crypto investors about Defi vulnerabilities & attacks

The Federal Bureau of Investigation (FBI) warned the crypto investors about their activities in Decentralized finance (Defi) ecosystem-associated risks. 

The population in the crypto Industry is continuously increasing because of the uniqueness of this innovative industry over the traditional money market. But the origin of Defi (Decentralised finance) based projects arose new risks to the funds of investors because of the bugs & vulnerabilities issues. 

This week, the FBI issued a public warning message to target those people who invest funds in Defi Protocols. Through the issued statement, the FBI suggested all Defi platform Investors remain away from such platforms because of cyberattacks.

FBI noted:

“Between January and March 2022, cybercriminals stole $1.3 billion in cryptocurrencies, almost 97 percent of which was stolen from Defi platforms, according to the US blockchain analysis firm Chainalysis.”

The agency noted that Defi attacks surged by 70% in 2021 over 2020 and the same figure surged by 30% in 2020. According to the FBI, these reports signify the degree of risks associated with the Decentralized crypto platform, where attackers took advantage of the open-source nature of the platform.

It is worth noting that half a month ago, a similar kind of alarm was issued by the Securities and Exchange Commission of Thailand (Thai SEC), to keep the citizens away from Defi protocol investment because of the high risk of attacks on such platforms. 

Defi origin, opportunities & risks 

Initially, the concept of Defi came to light during a discussion among the Ethereum developers in 2018. In 2019-20 many Defi projects entered the crypto industry.

The majority of the Defi platforms were associated with bugs but still, people showed significant interest because of the number of methods to make money via these Defi platforms. 

More than 3 years have been completed with the Defi concept and now the majority of the Decentralized exchanges are much better in terms of safety & security but still, there are few protocols that have some critical bugs, & are hard to find, but not for talented bad hat hackers.

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