The FBI gives its advice on investing in DeFi. Attacks on platforms are multiplying, you must take every precaution.
According to the Federal Bureau of Investigation (FBI), cybercriminals are increasingly exploiting security flaws in smart contracts to steal cryptocurrencies. In a paper released just recently, the agency is warning investors of a significant increase in attacks targeting decentralized finance (DeFi) platforms.
The FBI Gives DeFi Investing Advice
Between January and March of this year, hackers stole $1.3 billion in cryptocurrencies, with almost 97% of that money coming from DeFi platforms, the FBI reports, citing Chainalysis data. This is an increase from 2021 and 2020, with DeFi-related theft accounting for “only” 72% and 30%, respectively, of all stolen cryptocurrencies. The agency also witnessed how criminals used a wide variety of methods to defraud the platforms. For example, hackers used a flash loan attack to steal about $3 million worth of cryptocurrencies. Another attack was aimed at a signature verification vulnerability on the platform bridge: $320 million flew away.
Attacks on platforms are on the rise
Many of the most massive attacks in recent months fall into these categories. For example, the largest cryptocurrency theft to date has been carried out by the Lazarus group on Axie Infinity. Hackers exploited a backdoor in the Axie Sky Mavis creator’s RPC node to create fake payouts using compromised private keys. Most recently, the Nomad bridge hack lost 200 million cryptocurrencies due to a misconfiguration.
The FBI, which is accustomed to this kind of warning, advises investors to take every precaution before placing their money on a DeFi platform. Take the time to learn about the platform you want to invest in and the smart contracts it uses. Also, you should only invest your money in companies that have done an independent code audit. Also avoid investment pools with a very limited time period.
You must take every precaution
“Cybercriminals are looking to take advantage of the ever-increasing investor interest in cryptocurrencies, as well as the complexity of cross-chain functions and the open source nature of DeFi platforms,” the FBI explains. “Investors should make their own investment decisions based on their financial goals and financial resources, and if in doubt seek the advice of a licensed financial advisor.”