Chainalysis, an on-chain analytics company, has reported 13 incidents of $2 billion stolen from cross-chain bridge Nomad so far this year.
Hacks across the chain Bridge account for 69% of all hacks this year.
Cross-chain Bridges are designed to address interactivity between different blockchains.
It allows users to transfer assets from one chain to another blockchain.
Wormhole(also the site of a major hack) will allow users to transfer cryptocurrencies and NFTS between smart contract blockchains such as Solana and Ethereum.
Different cross-chain Bridges have different designs, but typically they allow users to send assets to cross-chain protocols, lock assets on one chain, and issue equivalent assets to the corresponding protocol on the other chain.
Chainalysis believes that this year’s big losses are due to the fact that the chain bridge is a key target for North Korean hackers because it has a lot of valuable assets flowing around, making it more attractive for hackers.
Chainalysis estimates that North Korean hackers have stolen nearly $1 billion in cryptocurrency this year, all through the chain bridge and DeFi protocol, while the South Korean government puts North Korea’s official export revenue at just $89 million.
Why are chain Bridges vulnerable?
Because the cross-chain protocol is responsible for locking assets to support parallel assets on another chain, this repository is an easy target.
Chainalysis says that because cross-chain Bridges are not yet designed to be efficient and are still a developing technology, different new technologies have weaknesses that could be exploited by perpetrators.
What can we do?
Chainalysis says hackers have targeted centralized exchanges in the past, but more recently it’s been rare to hear of successful attacks.
That’s because these companies prioritize security, and hackers will still focus on the newest and easiest targets.
Chainalysis believes that while code auditing is not foolproof, the first step to addressing such issues should be to design extremely stringent DeFi auditing standards and build the most robust and secure example of smart contracts.