Attacks and Exploits in DeFi | Crypto.com (2024)

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Attacks and Exploits in DeFi | Crypto.com? ›

DeFi has taken the world by storm thanks to its boundless opportunities and applications. This report has covered several common DeFi attack vectors and mitigations, including price oracle manipulation, reentrancy attack and the rug pull.

Key management compromises. The most common DeFi cybersecurity risks are “key management compromises” (e.g. by individual users or by admins/developers at projects and exchanges), coding mistakes, misuse of third-party protocols, and business logic errors.

Why the huge drop in stolen funds? Mostly due to a drop in DeFi hacking. Hacks of DeFi protocols largely drove the huge increase in stolen crypto that we saw in 2021 and 2022, with cybercriminals stealing more than $3.1 billion in DeFi hacks in 2022. But in 2023, hackers stole just $1.1 billion from DeFi protocols.

KING OF DEFI Price (KODX)

KODX is a decentralize finance aggregation protocol that delivers a diverse range of staking and lending products all at once. KODX would be put up as collateral to borrow stable coin Such as TRC20-USDT, USDJ.

This is how it works: The attacker rents mining capacities and forms a block containing only the transactions they need. Within the given block, they can first borrow tokens, manipulate the prices and then return the borrowed tokens.

Hackers exploit DeFi protocols through various methods. One of the most popular DeFi hacks is a smart contract exploit, which involves exploiting flaws in the code of the smart contract used by the DeFi protocol. This method allows hackers to manipulate the DeFi protocol's behavior and steal users' assets.

Impermanent loss. Impermanent loss is one of the most common and misunderstood DeFi market risks. When a user provides liquidity, they must deposit two types of assets. As other users buy and sell tokens from the pool, the asset ratios shift, increasing the value of one while lowering the value of the other.

What is the safest DeFi? ›

Uniswap's decentralized exchange (DEX) functionality makes it the go-to platform for traders seeking efficient and secure transactions. The absence of intermediaries and the use of smart contracts ensure transparency and reduce the risk of fraud, positioning Uniswap as the best DeFi trading platform in 2024.

It's recommended that all DeFi users should disconnect their crypto wallets after each session when using DeFi platforms. By disconnecting, you prevent other Web3 apps from accessing your wallet details and token balances, reducing the risk of unauthorized access and potential loss of funds.

Slippage, in the context of DeFi trading, refers to the discrepancy between the expected price of a trade and the price at which it is executed. It is the difference between what you intend to pay or receive for a trade and what you end up paying or receiving.

Wallets can be accessed by hackers using various techniques and can even be locked by ransomware.

The biggest risk in the current DeFi market is not based on mechanistic failures such as those that caused the collapse of Terra, but rather on three key factors: scale, complexity, and interconnectivity.

How to avoid it: If you are swapping an illiquid token, the only thing that can be done to minimize negative price impact is to reduce the amount swapped. As a courtesy, 1inch provides a warning that will show how much you will lose (in percentage terms) to price impact before you make the swap.

Lido (LDO)

Lido is the largest liquid staking platform, with over $28 billion worth of ETH locked with it. It is also the largest DeFi project, accounting for a third of the entire sector. Lido is the go-to platform for staking ether.

Uniswap is the world's biggest decentralized exchange. You can use Uniswap to buy, sell, and trade ERC-20 tokens on the Ethereum blockchain. To start using Uniswap, simply plug in your Ethereum wallet.

In this guide, we will review the most popular decentralized finance (DeFi) cryptocurrency coins for 2024. DEXs dominate DeFi with Uniswap (UNI) holding a $6.44 billion market cap. Lido (LIDO) leads staking protocols with a $3 billion TVL. Aave (AAVE) tops lending/borrowing with a $2 billion TVL.