A Year of Bridge Exploits

Key Insights

• In the past year, over $2 billion has been stolen from the greater DeFi ecosystem via bridges due to vulnerabilities in smart contract code, multi-signature compromises or from a backend exploit.
• A cross-chain bridge enables the transfer of data, primarily token assets, between blockchains to take advantage of greater liquidity, to build a better user experience in terms of cost and transaction finality, and to reduce main chain congestion by distributing transaction loads across the greater ecosystem.
• NEAR’s Rainbow Bridge has successfully mitigated two attacks over the past year due to its unique infrastructure and preventative tactics.

In the past year, over $3 billion has been stolen from the overall decentralized finance (DeFi) ecosystem, with over ⅔ of the stolen value stemming from bridge hacks. In order for DeFi to evolve as a credible and secure ecosystem, the vulnerabilities within the space need to be mitigated. This report dives into how a bridge works, the types of hacks that have occurred over the past year, and how one bridge in particular was able to mitigate two separate exploit attempts.

Bridging Basics