Cross-chain bridge theft exceeded the 1 billion dollar brand in 2022

Cross-chain bridge theft exceeded the 1 billion dollar brand in 2022

With increasing investment in cryptocurrency, the incentive for criminal actors is also increasing to take advantage of the defi room (decentralized finances). Cross-chain bridge hacks in 2022 were the weapon of election for cryptodic thieves. Bridge hacks have identified more than one billion dollars of stolen funds this year, so investigations of the blockchain analysis and compliance company Elliptic.

cross-chain-bridges enable the movement of assets between different blockchain protocols, which means that the networks contain a great concentration of crypto-assets. The latest series of Bridge attacks has prompted some industry leaders to ask themselves whether the advantages of Bridges outweigh their risks. A top analyst at Elliptic believes that bridge hacks are only growing pain that defi will finally overcome.

Harmony, Sky Mavis and Wormhole suffered all blockchain exploits of over $ 100 million this year. Mudit Guppa, Chief Information Security Officer at Polygon, believes that bridge uncertainty is an industry -wide problem.

"Most hacks happen because companies have no suitable security experts and do not know what to do themselves," said Guppa in a Twitter DM. "There are very few defi companies with [dedicated] security personnel."

Defi protocols have spread rapidly in the past six years, but the security infrastructure has not kept pace with a volume of over $ 900 billion. For this reason, hacks are not surprising in the millions.

On April 1, a dealer tweeted his fear that a large Harmony Horizon Bridge Exploit would only require that a hacker received two of the five validation key of the protocol. This scenario occurred in June - and Harmony was looted for $ 100 million.

Vitalik Buterin, co-founder of Ethereum, believes that cross-chain bridges are naturally susceptible to security violations.

"The basic security boundaries of Bridges are actually a main reason why ... I am pessimistic about cross-chain applications," wrote butterin in a long Reddit contribution from January. The influential founder further expressed his conviction that assets should be kept in the same blockchain ecosystem instead of being mixed between chains.

TARA Annison, Head of Technical Crypto Advisory at the crypto research company Elliptic, disagrees.

"We won't live in a single-chain world," said Annison. It will always be necessary to move assets between blockchains, so "we should not generally characterize Bridges as badly just because some have been hacked".

Annison believes that bridge hacks are caused by the concentration of value within cross-chain-bridges, not by the Bridges itself.

"If you think of wars, try to bomb bridges to stop the transport of goods and services," said Annison. The latest cross-chain-bridge hacks do not take place "because Bridges are naturally a weak infrastructure, but because they have a concentration of value".

Annison believes that all crypto assets are associated with risks, and Bridges are only the risk of "taste of the month" after stable coins in May and NFTs before. Bridges should become safer if protocols become more sophisticated.

It remains to be seen whether the market participants agree.

The Ronin Bridge by Sky Mavis, which was compromised for $ 625 million in April, was reopened this morning. According to Messari, assets of almost $ 9 million have already left the chain.

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The Post Cross-Chain Bridge Theft Top $ 1b in 2022 is not a financial advice.