Uniswap

Dominoes Threat in DeFi Market – Opinion

admin

Navigation

DeFi Yield Farming: Why It’s All the Rage But Risky – Ep.180

Dominoes Threat in DeFi Market - Opinion

Dominoes Threat in DeFi Market – Opinion
CONTENT

  • Excessive hype around DeFi could affect the safety of new projects

  • The close relationship between Ethereum-based applications could lead to a threat of the domain effect

  • Out of a dozen new products, only a few can cope with the load of increased demand

International consortium of news organizations developing transparency standards.

As decentralized finance develops, the interconnection between projects increases, which signals the potential threat of a collapse of the entire market.

Every day, the ecosystem of decentralized finance (DeFi) Decentralized finance (DeFi) is financial services built on blockchain technology that offer users access to an open, efficient and … More.

As the analysts of the DappRadar service have found out, such growth may mean not only the emergence of new DeFi products, but also the maturing risks associated with the security of such projects..

Dominoes Threat in DeFi Market - Opinion

Join our telegram channel to keep abreast of the main trends in the crypto market.

In the first half of 2020 alone, more than 5 attacks were carried out on popular DeFi platforms, including Balancer ($ 500,000 stolen) and bZx (17,500 ETH stolen in total).

“More and more we are starting to see ‘algorithmic’ attacks that involve not a flaw in the code, but a design problem. The system behaves as intended, but the attacker uses the edge case “, – noted in DappRadar.

Excessive growth

Analysts emphasize that the strengthening of the relationship between decentralized applications directly affects the likelihood of the threat of a domino effect..

“The ecosystem is still in a state of development, and it would be unreasonable to believe that attackers will no longer use vulnerabilities,” the company added..

However, vulnerabilities do not have to be technical in nature. Attackers are testing different ways to steal personal funds, including using social engineering.

Recently, for example, the editorial staff of BeInCrypto reported that Google began advertising several fraudulent fakes at once, looking almost like a decentralized cryptocurrency exchange protocol Uniswap.

Due to the prohibitively high rate of development of the industry, analysts believe that the DeFi market may be flooded with projects with weak levels of security for the sake of rush demand..

Balancing on the blade

Nevertheless, individual cryptocurrency ecosystems of decentralized applications were still able to demonstrate resistance to a high rate of development..

Dominoes Threat in DeFi Market - Opinion

An example is the MakerDAO project, which was hit hard by the March collapse, as well as too risky farming on the Compound platform..

However, the communities were still able to make the necessary changes and take a step forward, analysts say..

DappRadar points out that the actual level of activity in the DeFi market may be several times lower than many claim.

That is why it is important to be patient as it [the market] develops, added the company.

What do you think? Share your thoughts with us in the comments and join the discussion in our Telegram channel.

Disclaimer

All information contained on our website is published in good faith and objectivity, and for informational purposes only. The reader is solely responsible for any actions he takes based on the information received on our website..

Share Article

Similar articles

Similar articles