Ethereum community members propose new standard to mitigate DeFi hacks
A group of Ethereum community members has proposed a new standard to improve the security of decentralized finance (DeFi) protocols. Dubbed ERC (Ethereum Request for Comments) 7265, the proposed standard would enable a “circuit breaker,” allowing DeFi protocols to easily add a back-stop in their smart contracts that stops tokens before they leave the contracts in the event of a hack.
The proposed ERC 7265 standard comes amid rising DeFi hacks. Nearly $3 billion worth of funds have been stolen by attackers from DeFi protocols to date, according to The Block’s Data Dashboard. “We all agree, DeFi is broken,” said Meir Bank of Fluid Protocol. “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.”. “There are very few downsides and many upsides for governed DeFi protocols to integrate ERC 7265,” Bank said. “We are going to continue education going forward to save DeFi.”