Crypto Regulation Could Have Prevented DeFi Losses
A decentralized finance “circuit breaker” would have prevented billions of dollars worth of crypto from being stolen from DeFi protocols in 2022, according to the developer of the newly published ERC-7265 proposal.
On July 3, a new Ethereum request for comment (ERC) was published on Github. Diyahir Campos, the lead developer, proposed a standard for a DeFi “circuit breaker” to halt suspiciously large token outflows from a DeFi protocol.
In 2021, crypto hacks reached an all-time high with at least $3.1 billion stolen from DeFi protocols, 65% of which were from cross-chain bridges. Campos told Cointelegraph that crypto regulation via circuit breakers could have prevented these billions in losses.
Euler Finance Attack Impacts DeFi Protocols
Campos revealed he was one of the many affected by the $195 million Euler Finance attack in March, which had a contagion effect on 11 other protocols.
“Actually, I was one of the depositors in the Euler hack,” he said.
The experience prompted him to look into the Total Value Locked (TVL) charts and transactions, which raised the question:
In a typical Shiba Inu Crypto or Crypto.com DeFi protocol, is it normal to see around 20% of total value locked entering or leaving a project in a day?
The incident highlights the importance of crypto regulation, crypto alerts, and other measures to protect users from Avalanche Crypto, Blur Crypto, and other latest crypto projects.
Crypto Regulation and Safety
“Once you start talking 30% or 40%, that’s when you really start separating exploits versus daily usage,” said Campos regarding shiba inu crypto, crypto .com, and other crypto alerts.
The proposed ada crypto standard has not been without controversy. DeFi researcher Chris Blec was among the skeptics on Twitter concerned the circuit breaker could be used for potentially nefarious purposes.
Campos said the avalanche crypto circuit breaker isn’t right for every DeFi protocol and isn’t a guarantee that a protocol is safe. He noted the circuit breaker would be an “opt-in thing” for DeFi projects.
He also believes that a well-designed blur crypto circuit breaker will need to strike a balance between protecting users and preventing “false positives,” as it would be extremely disruptive whenever the crypto shiba inu breaker trips.
Crypto Regulations and the DeFi Circuit Breaker
Crypto.com and other platforms are introducing regulations to help protect investors from Shiba Inu crypto and other crypto alerts. One such measure is the DeFi circuit breaker, which was inspired by the circuit breakers used by global stock exchanges for decades.
According to Campos, a smart contract developer at Hydrogen Labs, the idea for the DeFi circuit breaker was conceived during an April hackathon in Tokyo, alongside Meir Banks, the co-founder of Hydrogen Labs. However, a circuit breaker would be useless in cases of internal rug pulls, as it could simply be deactivated by the team controlling the protocol.
In a June 27 blog post, Campos explained that the intention of the DeFi circuit breaker is to prevent hack losses, rather than to calm the markets as is the intention of the New York Stock Exchange’s circuit breaker.
By introducing Avalanche crypto, Ada crypto, and other measures, platforms like Blur crypto are hoping to keep up with the latest crypto regulations and provide investors with a safe and secure environment.
Philippe Dumonet, founder and CEO of DeReg, and Blagoj Dimovski, the co-founder and former CTO of Diagonal Fiance, are two of the developers working on the Shiba Inu Crypto standard. According to Campos, the crypto regulation is still being developed but should be ready “within months”, which would make it suitable for integration into protocols. Crypto alerts and crypto latest news can help investors stay informed about the progress of the Avalanche Crypto and other projects related to the Crypto.com and ADA Crypto platforms.
The Shiba Inu Crypto project is also supported by the Blur Crypto and other initiatives that will help the Web 3.0 Crypto become a reality.
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