The rise in cybercrime targeting the DeFi sector has prompted the US Federal Bureau of Investigation (FBI) to issue alerts to investors and platforms about the inherent dangers. The agency is also proposing a series of measures to help safeguard their assets from malicious entities.
The FBI stated, “Cybercriminals are intensifying their efforts to find and exploit loopholes in the smart contracts that underpin DeFi platforms, resulting in cryptocurrency theft and consequent financial losses for investors. These criminals are capitalizing on the surging interest in cryptocurrencies and the intricate cross-chain operations combined with the open-source disposition of DeFi platforms.”
Given the situation, the FBI offers the following guidelines to investors to help secure their assets:
- Engage in comprehensive research on DeFi platforms, protocols, and smart contracts prior to making any investments. Additionally, always stay informed about the unique risks associated with these investments.
- Confirm that the chosen DeFi investment platform has undergone code audits conducted by independent third parties.
- Exercise caution with DeFi investment pools that present extremely short windows for participation and rapidly implement smart contracts, especially if they bypass the suggested code audit.
- Recognize the inherent risks that come with relying on crowdsourced approaches for detecting vulnerabilities and implementing fixes.
Meanwhile, the FBI has also provided advisories for DeFi platforms to bolster their security:
- Employ real-time analytics, continuous monitoring, and thorough code testing. This will facilitate faster detection of vulnerabilities and enable timely responses to signs of questionable activities.
- Formulate and execute incident response strategies. These should include notifying investors about exploitations of smart contracts, detected vulnerabilities, and any other suspicious actions.
- A recent study by the blockchain research firm, Chainalysis, suggests that certain kinds of crypto-related crimes, such as hacks and fund thefts, have seen a spike this year. According to the firm’s experts, a significant portion of this increase can be traced back to the escalating amount of funds pilfered from DeFi protocols, a pattern that started emerging the previous year.