The connection between networks is the Achilles heel of DeFi in 2022. Hacks that take advantage of flaws in these methods exceed USD 880 million.
Decentralized finance (DeFi) protocols have suffered many attacks from cybercriminals over the last two years. In 2022, hackers seem to have found a new target to disrupt these networks, the bridges or bridges between networks.
According to a quarterly report revealed by CoinGecko, blockchain bridge hacks have already caused losses registered at more than $1 billion so far this year.
Bridges are connections that give the green light to digital assets to get sent and received between various platforms. According to the report, its relevance has increased as Ethereum lost dominance to other chains such as BNB Chain.
The total value locked (TVL) in Ethereum bridges has grown almost continuously since July of last year. Polygon already reigned over the spectrum at the time, with the advantage of being an Ethereum sidechain, giving immediate compatibility with the “queen” of Defi.
Bridges necessary for DeFi
As you can see in the chart below, Ethereum almost dominated the Defi space until February 2021. Since then, the growth of other networks has leveled the picture, although the network co-created by Vitalik Buterin is still ranked 55th. % From the market.
Bridge Attacks in DeFi
Media outlets have come to cover several attacks of this type, but one episode that had the most impact was that of the Ronin network, where the Play-to-Earn Axie Infinity game functions. A hacker took advantage of a “security breach” in a Ronin bridge to extract at least 174,000 ETH in late March.
Earlier, in early February, there was another major attack. It got suffered by Wormhole, a bridge between Solana and other networks, from which 120,000 ETH (USD 361 million) got stolen due to vulnerability in its code.
Finally, the report highlights that there are efforts under development to create more procedures that could enhance the security of these protocols. Options such as light clients, liquidity networks, and external validators got listed on page 30 of the document, each with its technical features that bring better security and confidence to these networks.
Experts have been working hard to solve this increasing problem for a long time. In mid-2021, during a developer conference, they explained that bridges are necessary for DeFi because they allow blockchains that use different languages to communicate.
By: Jenson Nuñez
