Aug 04, 2022 14:50
This week, blockchain analytics company Chainalysis published a research in which it identified cross-chain bridge protocol flaws as the greatest security threat.
In 13 different incidents this year, the company believes that $2 billion in crypto assets have been taken from bridges. Attacks on cross-chain bridges are responsible for 69% of the total cash taken this year, it said.
A bridge is a piece of software, often composed of smart contracts, that enables the movement of tokens across networks, such as Ethereum (ETH) and Avalanche (AVAX). Despite Ethereum's ERC-20 being the de facto industry standard, each blockchain ecosystem has its own token standard.
The claim comes in the wake of this week's Nomad bridge attack, which cost the protocol's whole $190 million in collateral.
The research also said that as more value passes across these bridges, hackers grow more drawn to them. Additionally, it claimed that North Korean hacker gangs had been responsible for half of the money stolen so far this year by attacking bridges and decentralized finance (DeFi) protocols.
Because they often house the cash that support the bridged tokens on the destination chain, bridges are valuable targets for cybercriminals. The aim is that the money become a central storage location, regardless of whether they are kept in a smart contract or by a centralized custodian.
Furthermore, since bridges are mostly experimental and the technology hasn't had a chance to develop, weaknesses and fresh attack routes may be found.
The Ronin bridge was the target of the greatest bridge hack to history, which netted $615 million in March. Users may move Axie Infinity (AXS) Metaverse game assets across other blockchains using Ronin. The Solana (SOL) Wormhole bridge generated $325 million in revenue in February.
Crypto platforms have been asked to go through stringent auditing procedures in order to safeguard themselves. However, even audited smart contracts are vulnerable to attack, as was the case with Web3 music streaming service Audius, which suffered a breach in July and lost $6 million.
The Solana ecosystem saw another blow this week, despite not being a bridge assault, when up to 8,000 wallets were compromised for more than $8 million.
Crypto markets would fall in prior years due to hacks and vulnerabilities that cost millions of dollars. They don't seem concerned this week, however.
The whole market value has increased by 2% for the day to $1.12 trillion. Markets are still range-bound, however, since resistance is too powerful to break through.
While Ethereum was trading 2.7 percent higher this morning at $1,654 at the time of writing, Bitcoin (BTC) had risen a meager 1.5 percent to $23,146.
Aug 04, 2022 14:41