To increase the security of decentralized finance (DeFi) protocols, a group of Ethereum community members has suggested the ERC 7265 standard.
ERC 7265 Standard Proposed by Ethereum Community Members to Prevent DeFi Hacks
According to one of the standard’s developers who goes by the Twitter handle @tcb_00, the proposed standard, dubbed ERC 7265, would enable a circuit breaker allowing DeFi protocols to easily incorporate a back-stop in their smart contracts that stop tokens before they leave the contracts in the event of a hack. @Diyahir and @real_philogy are among the other builders.
About ERC 7265
The most common protocols in DeFi are those that can be modified by governance. Hence the ERC 7265 standard is made for them. Meir Bank of Fluid Protocol has already shared a series of tweets about the standard on his Twitter account.
DeFi Hacks Lead to the Theft of Too Many Assets
Hackers have taken nearly $3 billion worth of funds from DeFi protocols thus far.
We all agree, DeFi is broken. Not only are there many hacks, but the results are catastrophic. When protocols are hacked, often they lose everything. The TVL (total value locked) tanks to zero in a matter of seconds.
Meir Bank Of Fluid Protocol
What Did Meir Bank Say About DeFi Attacks and The New Standard?
ERC 7265 allows teams to create a circuit breaker protecting their protocol, with highly customized rate limit parameters per asset. When a hack happens, the attacker will no longer be able to drain an entire contract in seconds. The majority of funds can be recovered.
Bank
According to Bank, DeFi attacks result in significant losses since most protocols don’t respond quickly enough to prevent them. By the time anyone recognizes what’s happening, it’s already too late, and even when a team attempts to correct things, it’s typically too late, he added.
There are very few downsides and many upsides for governed DeFi protocols to integrate ERC 7265. We are going to continue education going forward to save DeFi.
Bank
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