Decentralized finance (DeFi) protocols have suffered a large number of attacks from cybercriminals over the last two years. In the course of 2022, hackers seem to have found a new target to attack these platforms, the bridges or bridges between networks.
According to a quarterly report posted by CoinGecko, the hacking of bridges between block chains already caused losses of more than USD 1,000 million so far this year.
Bridges are connections that allow crypto assets to be sent and received between various networks. As highlighted in the report, its importance has increased as Ethereum has lost dominance in this ecosystem to other chains such as BNB Chain (former Binance Smart Chain), Terra and Avalanche.
The total value locked (TVL) in bridges of ethereum has grown almost continuously since July of last year. Polygon already dominated the spectrum at the time, with the advantage of being an Ethereum sidechain, allowing immediate compatibility with the “queen” of DeFi. Later, alternatives such as the Avalanche, Arbitrum, Fantom Anyswap and Ronin bridges were added.
Why are bridges necessary for DeFi?
As you can see in the chart below, Ethereum dominated DeFi almost completely until February 2021. Since then, the growth of other networks has leveled the picturealthough the network co-created by Vitalik Buterin still has 55% of the market.
In CriptoNoticias it has been pointed out that experts have been working on this type of solution for a long time. In mid-2021, during a developer conference, they explained that bridges are necessary for DeFi because they allow blockchains that use different languages to communicate with each other.
History of bridge attacks in DeFi
This newspaper has reported several events related to attacks on bridges between blockchains during this year. One of the most impactful was the one with the ronin networkwhere the game Play-to-Earn Axie Infinity takes place.
In late March, a hacker took advantage of what the company responsible called a “security breach” in a Ronin bridge to steal 174,000 ETH. At the close of this note, the equivalent dollar figure is more than 524 million according to the CriptoNoticias price index.
Earlier, in early February, there was another major attack. he suffered it wormholea bridge between Solana and other networks, from which 120,000 ETH (USD 361 million) were stolen also because of a vulnerability in its code.
Finally, with regard to possible solutions for this type of problem, the report highlights that work is being done on mechanisms that enhance the security of these protocols. In this sense, options such as light clients, liquidity networks and external validators are listed on page 30 of the document, each with its own technical characteristics that provide greater security and confidence to these platforms.