HAPI is a security infrastructure provider for decentralized finance (DeFi) and cryptocurrency projects. Developed by the Ukrainian cybersecurity consulting firm Hacken Foundation and founded by the pseudonymous Dona Mara, it aims to disrupt crypto security.
The concept is rather simple: HAPI gathers data about all the hacks that take place in the industry and records all the compromised addresses. It then provides this data as a trustless security oracle to any interested parties, mainly centralized (CEXes) and decentralized exchanges (DEXes). As a result, any suspicious transactions can be immediately blocked, and malicious actors cannot cash out stolen assets.
How Does HAPI Work?
HAPI is a set of cross-chain smart contracts that can be embedded into DeFi products for improved security. Its oracle and decentralized autonomous organization (DAO) systems deliver software as a service (SaaS) in the DeFi environment to prevent hack attempts.
HAPI is a multichain token: it is minted as ERC-20 on the Ethereum (ETH) blockchain and also available as BEP-20 on the Binance Smart Chain (BSC). One of the key utilities of HAPI is to connect data submitters with security oracles.
According to the project’s roadmap, after creating a DAO in Q1 2021, the following steps will be to develop oracles, protected smart contracts and application programming interfaces (APIs) to allow CEXes and DEXes on Ethereum and BSC to access HAPI. As of May 2021, the project’s team has not yet released any products.
In parallel with the platform’s development, HAPI is working on increasing its presence in the industry by establishing strategic partnerships.
Now, a few words about tokenomics, fwiw.
The total supply of 1,000,000 HAPI, of which only 78,000 HAPI are available from day 0, is allocated as follows:
Team + partners………….………….24%
Private token sale…………………...43%
Public token sale……………………...3%
The liquidity pool is the HAPI/ETH Uniswap pool, locked for one year. Farming rewards work differently: users will be getting HAPI for three years for staking HAI, another token created by the Hacken Foundation.
Tokens will be released according to the following 10-month curve:
Beyond staking and serving as a medium of exchange, HAPI tokens will be used in DAO governance and voting. In light of that, the fact that 67% of HAPI are in the hands of early investors and the team can potentially become a security concern.
What Makes HAPI Unique?
HAPI tokenizes security audits, aiming to make them a ubiquitous standard feature within smart contracts, centralized and decentralized exchanges, and DeFi applications.
The HAPI token is the only means of payment inside the ecosystem. Data submission, oracle queries, audit reports — every transaction will require HAPI tokens.
HAPI claims to have superior expertise in the area of hacking because of its affiliation with so-called “white hat” hackers — cybersecurity professionals who use their hacking skills for a good cause by providing cybersecurity audits, improving security standards and raising general awareness about cyberthreats.
HAPI is not the first cybersecurity product of the Hacken Foundation: since 2018, the team, led by Dyma Budorin, has been maintaining CER.live, a security rating of crypto exchanges. It has gained wide recognition in the industry, including partnerships with Coingecko and Chainlink and a mention by Binance’s CEO Changpeng Zhao.
A month after launch, the HAPI token has not displayed a notable correlation with the overall crypto market, which traditionally tends to follow the price of Bitcoin (BTC). Over the long term, this dynamic could suggest that security and speculation are non-correlated trends in crypto.
Risks of Centralization
Despite the advantages it offers, the very premise of the project as a single security authority for the crypto industry — which itself is decentralized by design — can be a reason for concern.
If HAPI someday becomes the default security oracle for most exchanges and an integral part of smart contracts, it could become the actual security bottleneck and the most likely target for malicious attacks.
How Does HAPI Compare to Competitors?
HAPI is not the first security oracle on the market — a similar project called CertiK, launched in 2020, has achieved ten times the market capitalization of HAPI as of May 2021. Unlike HAPI, it focuses on real-time security audits and runs on its own delegated proof-of-stake (DPoS) blockchain.
It features the CertiKShield program, which is an insurance policy against all security threats associated with blockchain. If a user protected by the program loses their assets in a malicious attack or loses access to their private keys, they can be reimbursed by CertiKShield. The asset pool is maintained by Collateral Providers, who stake their tokens in return for rewards.
Unlike Certik, HAPI is not an open-source project. It does not feature a detailed whitepaper or a public git repository, and it has not yet been able to secure strategic partners the size of Huobi.