Decentralized finance or DeFi is a rapidly growing financial sector powered by blockchain. This technology allows for worldwide access to products and services, eliminating third parties and providing an open financial system for the internet age. All processes like trading, lending, borrowing etc. are automated by smart contracts here. Whereas the permissionless nature of DeFi is instrumental in fostering rapid growth, it exposes investors to elevated risks. Maximum DeFi protocols are open source and the danger of error in the program code and configurations is common. The attackers have sufficient time to analyse vulnerabilities in a specific protocol and plan an attack. This is the reason, numerous DeFi protocols have been hacked previously and caused the loss of billions of dollars. In 2022, DeFi protocols as victims accounted for 82.1% of all cryptocurrency stolen by hackers — a total of
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Gm Gm, Really loving this piece and the work you do here. I also run a web3 news substack for underrepresented creators called Facesofweb3. Would you be open to a recommendation exchange? Our subscribers need to be able to find each other!
Great job, once again!