Binance CEO on Largest DeFi Hack: Nothing is Risk Free

By Godfrey Benjamin
Published August 11, 2021 Updated August 11, 2021
Best Buy In

Exchanges

Sportsbook

Wallet

Binance
Binance CEO Changpeng Zhao

Binance CEO on Largest DeFi Hack: Nothing is Risk Free

By Godfrey Benjamin
Published August 11, 2021 Updated August 11, 2021

The cryptocurrency ecosystem witnessed the largest decentralized finance (DeFi) hack on the interoperable Poly Network today. The hack saw a total sum of about $610 million removed across the Binance Smart Chain (BSC), Ethereum, and Polygon Network. The hack, discovered when a transaction on O3 Protocol could not process a transaction worth $150 million, comes off as one of the largest breaches to a named protocol after CoinCheck’s $530 million breach.

advertisement

The unforeseen event has stirred a number of controversial conversations about the security assurances of DeFi projects, in contrast with their centralized counterparts. Weighing on this matter is Changpeng Zhao, Binance’s Chief Executive Officer, popular known on Twitter as CZ. According him, he noted that both CeFi and DeFi protocols are unique in themselves, and that both have different risk characteristics which users are supposed to be familiar with before using them.

The seeming confusion might want to make some to consider the use of fiat and legacy banks for transactions. However, CZ said he does not think fiat are in anyway safer, highlighting its weaknesses, the Binance boss said fiat is fraught with inflation, high transaction fees, and the challenge of banks preventing users from accessing their own funds.

How Can the Blockchain Network Be Hacked

Many blockchain protocols are supposedly pitched by creators to be immune to breaches, however, the current happenings as it relates to multi-million dollar exploits is saying otherwise. CZ says the possibility for any blockchain network or decentralized application to be hacked depends on how the smart contract was written designed.

While not common, there is a 51% risk of attack in mainstream blockchain networks and despite the low possibility of this risk being initiated, users are still supposed to know about it and act accordingly.

In all, Changpeng Zhao noted that nothing is risk free, and that in helping to freeze the funds from the addresses of the hacker, a lot of analysis will have to be done by centralized exchanges, that is if the funds are deposited their.

advertisement
Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Godfrey Benjamin
147 Articles
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture. Follow him on Twitter, Linkedin

Loading Next Story