FBI Alerts DeFi Users Of Cyber Criminals Stealing Their Crypto Holdings

The U.S Federal Bureau of Investigation issued a new warning to investors alerting them of the increasing number of thefts in exploits related to decentralized finance.

What Happened: In a tweet on Monday, the federal law enforcement agency said that cybercriminals were increasingly targeting DeFi platforms to steal cryptocurrency.

The #FBI warns that cyber criminals are increasingly exploiting vulnerabilities in decentralized finance (DeFi) platforms to steal investors cryptocurrency. If you think you are the victim of this, contact your local FBI field office or IC3. Learn more: https://t.co/fboL1N17JN pic.twitter.com/VKdbpbmEU1

— FBI (@FBI) August 29, 2022

“Cyber criminals seek to take advantage of investors’ increased interest in cryptocurrencies, as well as the complexity of cross-chain functionality and open source nature of DeFi platforms,” the FBI said in a public service announcement.

See Also: What is DeFi?

Data from blockchain analytics firm Chainalysis estimates that hackers stole $1.3 billion between January and March, of which 97% was stolen from DeFi platforms.

The FBI urged investors to conduct more intensive research on the cryptocurrency platforms, protocols and smart contracts before investing in them in order to understand the specific risks involved.

“Be alert to DeFi investment pools with extremely limited timeframes to join and rapid deployment of smart contracts, especially without the recommended code audit,” the FBI said in a statement.

The regulator also urged DeFi platforms to employ real-time analytics, monitoring and more rigorous testing of code in order to more quickly identify potential vulnerabilities and suspicious activity on these decentralized platforms.

At the time of writing, there was over $60 billion in total value locked (TVL) on DeFi platforms — the bulk of which is built on the Ethereum ETH/USD blockchain — as per data from DeFi Llama.

Price Action: At press time, ETH was trading at $1,577, up 8.78% over the last 24 hours.