Decentralized Finance (or DeFi) refers to an industry where financial products can be made accessible on a public, decentralized blockchain network. DeFi is expected to replace traditional finance in 2030. DeFi emerged as a vibrant sector by 2021.

Cybercriminals are constantly inventing new tricks to trick investors and steal funds from DeFi. Elliptic, a blockchain analytics provider, estimates that more than $10.5 billion in user funds have been stolen by DeFi fraudsters and thieves between 2021 and 2021.

All-Time Record DeFi loss

Elliptic reports that DeFi has lost more than $12 Billion in total to exploits by 2021.

The report states that fraud and theft amount to $10.5 billion. Accordingly, fraud and theft account for $10.5 billion.

The London-based blockchain analytics firm explained that the large amounts raised by defi projects have attracted a lot of scammers and hackers who exploit bugs in the code and design flaws to siphon millions of investors’ funds.

The most notable exploits in 2021 include the $610 million Poly Network hack, PAID Network’s $180 million loss from an exploit, and the $130 million Cream Finance exploit.

Scammers have conned investors into buying their tokens in several DeFi rug pulls. The scammers then disappear along with their funds and leave investors with nothing but tokens.

To The Flipside

• Regardless of being called the “Wild West” of crypto, DeFi protocols continue to grow, with the The sector’s total value is now $258 billion.

Why you should care

DeFi protocol security must be improved to increase trust and acceptance.

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