This Is What the FBI Suggests to Those Who Invest in Defi

The Federal Bureau of Investigation (FBI) in the United States is taking action to warn investors and platforms about the risks posed by cybercrime, and it is also recommending a set of precautions that could prevent them from having their assets stolen by criminals. This is because cybercrime is having an increasingly negative impact on the decentralized finance industry.

The Federal Bureau of Investigation has stated that "cybercriminals are increasingly abusing flaws in the smart contracts that control DeFi platforms to steal cryptocurrencies, leading investors to lose money." "Cybercriminals want to capitalize on investors' growing interest in cryptocurrencies, as well as the difficultly of implementing cross-chain capabilities and the open source nature of DeFi systems,"

Keeping this in mind, the Federal Bureau of Investigation (FBI) advises investors to take the following precautions to safeguard their assets:

Before deciding on their investments, conduct extensive study on the DeFi platforms, protocols, and smart contracts, and ensure that they are aware of the specific dangers inherent in such investments;

Check that the chosen platform for investing in DeFi has successfully completed one or more code audits that were commissioned from independent auditors;
Maintain vigilance with regard to DeFi investment pools that have extremely constrained timeframes for joining and rapid deployment of smart contracts, especially in the absence of the recommended code audit;

Continue to be aware of the potential risk associated with crowdsourced solutions to vulnerability identification and patching.

At the same time, the FBI urges decentralized file-sharing platforms to exercise extreme caution and take the following safety measures:

Develop and put into action incident response plans that include notifying investors of smart contract exploitation, vulnerabilities, and other suspicious activities that have been detected; implement real-time analytics, monitoring, and rigorous testing of code so that vulnerabilities can be identified more quickly and a response can be given to indicators of suspicious activity; develop and put into action incident response plans.

According to research that was recently published by the business Chainalysis, which specializes in blockchain analysis, some types of crypto-based criminal activity, including hacking and the theft of cash, have so far increased in occurrence this year. The company's analysts believe that a significant portion of this can be ascribed to the pattern that began the previous year of an increase in the amount of money stolen from DeFi protocols.

According to the statement made by the corporation, "Through July 2022, USD 1.9 billion worth of bitcoin has been taken in hacks of services," which is an increase from the figure of just under USD 1.2 billion in the same period in 2021.