A $ 620 million hack?  Just another day in the crypto

A $ 620 million hack? Just another day in the crypto

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DeFi — an idea similar to smart contracts — is all about transparency and open source as an ideology. Unfortunately, in practice this too often means shaky multimillion-dollar projects held together by tape and chewing gum.

“There are a few things that make DeFi more vulnerable to hacking,” Grauer explains. “The code is open. Anyone can get over it by looking for mistakes. This is a big problem that we have seen that is not happening through centralized exchanges. “

Error reward programs — in which companies pay hackers to find and report security vulnerabilities — are a tool in the industry’s arsenal. There is also a domestic industry of crypto audit firms that will invade and give your project a seal of approval. However, a cursory glance at the worst crypto hacks of all time shows that auditing is not a silver bullet — and there is often little or no responsibility for either the auditor or the projects when the hacks occur. The wormhole was audited by security firm Neodyme just months before the theft.

Many of these hacks are organized. North Korea has been using it for a long time hackers to steal money to fund the regime which is largely cut off from the world’s traditional economy. Cryptocurrency was especially a gold mine for Pyongyang. Hackers in the country have stolen billions in recent years.

However, most hackers targeting cryptocurrencies do not fund the renegade state. Instead, the already powerful cybercrime ecosystem is simply opportunistically shooting at weak targets.

For the new king of cybercrime, the harder challenge is to successfully launder all stolen money and turn it from a code into something useful – cash, for example, or, in the case of North Korea, weapons. This is where the police come into play. Over the past few years, police around the world have been investing heavily in block analysis tools to track and, in some cases, even recover stolen funds.

The proof is Ron’s recent hack. Two weeks after the robbery, a crypto wallet with stolen currency was added to the U.S. sanctions list because the FBI managed to link the wallet to North Korea. This will make it harder to use the prize – but certainly not impossible. And while new monitoring tools have begun to shed light on some hacks, the ability of law enforcement agencies to recover and return funds to investors is still limited.

“Laundering is more sophisticated than hacks themselves,” said Christopher Janczewski, a former leading IRS case agent specializing in cryptocurrency cases. said MIT Technology Review.

For now, at least, high risk remains part of the crypto game.

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