DeFi protocols Recorded $386.2mln in losses Last Year March 13, 2023 March 13, 2023 Kelly Cromley http://1AZFjzw2#Nwf63pYaMWq#xIY
Market NewsMarch 13, 2023 by Kelly Cromley

DeFi protocols Recorded $386.2mln in losses Last Year

Reports indicate that the total value of cryptocurrency hackings surpassed $3.8 billion in 2022. As pointed out by Chainalysis, it is likely that not all breaches occurred in a conventional way.

As stated by Chainalysis, bad actors drained protocols for decentralized finance (DeFi) without exploiting a vulnerability in the protocol’s software code. Professionals call them oracle exploitation attacks, which involve the use of massive quantities of cryptocurrencies by malicious players to increase the transaction volume of low-liquidity crypto tokens on the intended DeFi protocol. In 2022, 41 distinct oracle exploitation assaults are estimated to have caused $386,2 million in losses to the protocols associated with DeFi.

On the basis of data provided by Chainalysis, certain assailants have argued that oracle fraud attacks should not be deemed illegal. Avraham Eisenberg, the person who was held accountable for a major oracle manipulation operation in 2022, defended the legality of his conduct and demonstrated a “profitable trading scheme.” Despite this, the SEC noted that Eisenberg’s activities constitute manipulation of markets.

In addition, Chainalysis reported that the SEC, CFTC, and DOJ all brought market manipulation allegations against Eisenberg. According to reports, these hackers aren’t allowed to evade culpability, even if the targeted protocol was profitable. During bug reward negotiations with Mango Markets DAO, Mango Markets also initiated a lawsuit on Eisenberg for failing to engage in “lawful negotiations.”

AuthorKelly Cromley

Kelly is our in house crytpto researcher, delving into the stories which matter from blockchains being used in the real world to new ico coming out.