Just 18 Out of 1,500 Major Cryptocurrencies Are Fully Secured, Shocking New Research Reveals
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Just 18 Out of 1,500 Major Cryptocurrencies Are Fully Secured, Shocking New Research Reveals

4 months ago

It's also emerged that 20% of projects have failed to fix critical security bugs after they have been identified through an audit — potentially putting their users in danger.

Just 18 Out of 1,500 Major Cryptocurrencies Are Fully Secured, Shocking New Research Reveals

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Only 18 projects out of 1,500 major cryptocurrencies are fully secured, according to damning new research given to CoinMarketCap.

Hacken Scout enlisted the help of 111 cybersecurity enthusiasts to perform a comprehensive audit of the DeFi sector in return for a financial reward.

And according to CER.live, which verified their findings, just 1.2% of coins on the list ended up passing an investigation with flying colors.

To be deemed fully secured, projects were required to have a bug bounty program and insurance — and ensure the code deployed for their platform and token matched the code that had undergone a security audit.

Meanwhile, 6.5% were described as well secured — but lack an insurance policy that would protect investors in the event something went wrong.

Overall, 32% of the projects that were scrutinized are currently using code that doesn't match what was reviewed by a security firm, meaning they may be misleading investors if they claim to be audited.

Another concerning statistic reveals that just 21% of platforms have an active public bug bounty program in place — schemes that incentivize white-hat hackers to discover exploits that could be used by malicious actors for financial gain.

It's also emerged that 20% of projects have failed to fix critical security bugs after they have been identified through an audit — potentially putting their users in danger.

CER.live said the findings show there are "serious security issues" in the Web 3.0 Space, adding:

"Projects still undervalue cybersecurity although it is one of the main factors impacting users’ investment decisions."

Each of the 1,500 cryptocurrencies that was scrutinized will now receive a rating — and it's hoped projects that score poorly will be encouraged to pay closer attention to security. As well as receiving a reputational boost, other benefits include securing investment from new users, and reducing the risk of an outflow of assets.

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What This Means for Crypto Users

The cybersecurity scouts who volunteered to investigate each cryptocurrency collectively earned 352,000 Hacken tokens — worth $24,000 at current market rates.

Hacken and CER.live say it would usually take months to gather data about 1,500 cryptocurrencies, but this approach sped things up dramatically while offering a financial incentive to volunteers.

Both organizations claim that many projects no longer use a code that was verified by auditors — and worse still, some platforms have failed to publish the audited code for their projects on GitHub.

Investors are being urged to double-check whether the crypto projects they're interested in are backed by insurance policies that protect the platform against the fallout from thefts or hacking incidents — as this ultimately protects the financial interests of end users.

Other top tips include verifying whether a platform's security audits cover all of the smart contracts in operation. While a crypto project may offer token swaps, farming and staking, it's possible that only one smart contract was scrutinized, leaving a high risk of vulnerabilities in the others.

Finally — if security vulnerabilities are identified through an audit — users should try to determine if a platform has fixed them, with CER.live accusing some projects of neglecting to take action because of a lack of time or resources.

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