Skip to main content

Vitalik Buterin's ominous DeFi prophecy comes true

 


Just a few weeks ago, Vitalik Buterin pointed out the massive security gaps in token bridges to the DeFi community. Now came one of the biggest hacks.


In recent months, so-called token bridges have become increasingly popular in DeFi space. Well-known token bridges are, for example, Multichain (MULTI), Allbridge (ABR), THORChain (THOR), Synapse (SYN) or Wormhole. They enable tokens to be freely transferrable between different blockchains. The big advantage for many investors is that they can transfer their digital assets between a variety of blockchains without intermediaries. On the one hand, they can save on transaction costs. On the other hand, this opens up a multitude of possibilities for them to use different DeFi protocols to earn interest.


For example, they can move their tokens between different blockchain networks at lightning speed to conduct arbitrage trading. In addition, the token bridges make it possible to exploit even more effectively short-term liquidity mining programs that are held on different blockchains in order to generate profits. For example, USDT Lending on Aave (Ethereum mainchain) earns just 2.1 percent annual interest , while USDT Lending on Polygon currently earns investors 10 percent annually thanks to liquidity mining rewards .


Token bridges thus make the DeFi space a lot more efficient, as they offer investors the opportunity to move between blockchain networks with theoretically infinitely many income opportunities. The big disadvantage, however, is that many token bridges currently still have significant security deficiencies. Again and again it happened in the past that they were victims of hacker attacks. For example, THORChain has been hacked multiple times and Poly Network made headlines around the world when a white hat hacker stole over $600 million .


DeFi hacker stole almost 320 million US dollars


Recently, there was another hack last Wednesday. The Token Bridge Wormhole lost around 320 million US dollars in the process . This incident comes as little surprise to Ethereum inventor Vitalik Buterin. In a Reddit post just a few weeks ago, the Ethereum mastermind warned the DeFi community about the significant security risks of token bridges. In a made-up scenario, he described the vulnerabilities that token bridges would have and how they could be exploited by malicious actors. The Wormhole case has shown once again how real the risks of token bridges still are.


The well-known DeFi expert “ChainLinkGod” nevertheless assumes that token bridges will play a decisive role.


Given that token bridges are an important part of the blockchain world, the goal should not be to prevent them, but to make them more secure.



Buterin also believes in a multichain future, but still expects a few hacks to come this year.

My Top Picks
Honeygain - Passive earner that pays in BTC or PayPal
MandalaExchange -The Best no KYC crypto Exchange! 
BetFury - Play And Earn BFG for daily Bitcoin and ETH dividends!
Pipeflare - Faucet that pays in ZCash and Matic, Games pay in DAI
Womplay - Mobile dApp gaming platform that rewards in EOS and Bitcoin
Cointiply - The #1 Crypto Earning Site
Torum - Join the latest Social Network and earn TRM for Free! 
LiteCoinPay - The #1 FaucetPay earner for Litecoin 
Upland - Collect Digital Properties & Test Your Skills
LBRY/Odysee - YouTube Alternative that lets you earn Money by viewing videos!
FaucetPay - The #1 Microwallet Platform
FREEBTC - The #1 FaucetPay earner for Satoshi's
FaucetCrypto - An earning/faucet site that pays out instantly
FireFaucet - An earning site that pays better for some than Cointiply
DogeFaucet - Dogecoin Faucet
xFaucet - BTC, ETH, LTC, Doge, Dash, Tron, DGB, BCH, BNB, ZEC, FEY - Claim every 5 minutes
Konstantinova - BTC, ETH, LTC, Doge, Dash, Tron, DGB, BCH, BNB, ZEC, USDT, FEY, 25 Claims Daily

Comments

Post a Comment

Popular posts from this blog

The 5 largest platforms for non-fungible token (NFT) collectibles

  Since the beginning of 2021, non-fungible tokens (NFT) have had no holding back and the sector is setting new records almost every day.  More and more artists, stars and brands are realizing the potential - NFT are well on their way to catapulting the crypto space into the mainstream.  But which collectibles are currently the most popular? What are NFT? NFT are unique tokens that cannot be exchanged one-for-one for an equivalent token.  Any asset that is tokenizable can be an NFT.  This includes, for example, (digital) works of art, trading cards, game items and crypto domains.  Theoretically, however, real estate or securities can also be mapped as NFT. NFTs can be used to transparently map ownership structures on a public blockchain.  This allows them to store value just like real objects, even if additional copies are easy to make.  For example, the original picture of the Mona Lisa is significantly more valuable than a photo, as everyone kno...
11 comments
Read more

CARDALONIA: THE CARDANO METAVERSE OPENS THE GATES!

  Have you ever been to Cardalonia? With these words, the Cardano Metaverse called Cardalonia starts the gates. In this 3D world, developers and users can interact with each other. First of all, users have to create an individual character with which they can move online. After that you can enter one of the worlds built by developers with this character. You can also purchase your own land in the Cardano Metaverse via the marketplaces in Cardalonia . This is secured by Cardano's blockchain technology and therefore offers a relatively secure transfer of ownership. Since these are only digital plots of land, it is not yet entirely clear when the plots of land are purchased whether they can also be sold again in the future. A possible profit cannot be estimated at the moment. In Cardalonia, the cryptocurrency Lonia is used. The maximum amount of tokens in circulation is 100,000,000. The team consists of Alice Sand (Co-Founder), Vasil Air (CTO) and Dustan Water (Fullstack Developer). T...
Post a Comment
Read more

Cardano: This is the vision that founder Charles Hoskinson has

  The Altcoin Cardano has tended to decline in recent weeks.  The Alonzo upgrade was supposed to bring improvements, but it soon turned out to be a disappointment.  Cardano founder Charles Hoskinson presented his vision for the cyber motto in a live Twitter video. • Cardano in the last few months under pressure • Charles Hoskinson explains his Cardano vision via Twitter • Security and privacy at the center The cryptocurrency  Cardano  has had a difficult few months.  While founder Charles Hoskinson's cyber motto has had a strong run in 2021, it has been steadily downhill in recent months.  Cardano is faced with some difficulties.  The so-called Alonzo upgrade went live in mid-September, for which crypto fans had high hopes, but which soon turned out to be a disappointment.  The upgrade should make it possible to use smart contracts on the cryptocurrency as well.  It soon turned out, however, that although these were entered into Cardano,...
Post a Comment
Read more