FBI issues recommendations for DeFi investors amid exploits

Quick Take

  • The US Federal Bureau of Investigation (FBI) issued new recommendations for DeFi investors on August 29, citing an uptick in criminals exploiting smart contracts.
  • The FBI recommends that DeFi investors do research and see if platforms have done code audits, among other suggestions. 

The US Federal Bureau of Investigation (FBI) is encouraging investors in decentralized finance (DeFi) protocols to seek platforms that have undergone code audits in light of an uptick in criminals exploiting vulnerabilities in smart contracts.

"Cyber criminals are increasingly exploiting vulnerabilities in the smart contracts governing DeFi platforms to steal cryptocurrency, causing investors to lose money," the FBI wrote in an August 29 public service announcement detailing recommendations for investors and DeFi platforms alike. 

DeFi has played a leading role in cryptocurrency theft this year. DeFi protocols were related to a whopping 97% of the cryptocurrency stolen through May 1, Chainalysis reported. By July, the blockchain analysis company found that hacks were responsible for the overall theft of $1.9 billion worth of cryptocurrency in 2022 so far.

The FBI made four key recommendations for investors in DeFi protocols. First, it encouraged people to be aware of the broad risks of DeFi and to do their research. Then, it recommended that people use platforms that have undergone one or multiple third-party code audits.

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