So much for this "Defi" hype, BTC is on the only Decentralized Finance

[Baofeng]

ETH Defi Platform, bZx was not only hacked once, but twice already.



https://twitter.com/bzxHQ/status/1229626207869657088

They have this thing called "Flash Loans", which was exploited by the hackers and lost almost $650,000. Maybe it was poorly designed, I myself has a very little understanding though, but as I have said in some of my post about this whole new Defi protocol, for me BTC is the only Decentralized Finance that is very much secure.

[rosezionjohn]

Wait a second. If someone can pause it, why is it part of defi? That sounds ironic to me. I would appreciate if someone could explain to me how is it decentralized.

for me BTC is the only Decentralized Finance that is very much secure.

It's definitely the most secure protocol and it has been proven time and time again. I think only supporters of bitcoin wannabes will say otherwise.

[Dabs]

The whole idea of "flash loans" is odd to me, as I can not even get to borrow $1 from a friend and pay it back in the same transaction. There is usually a minimum amount of time before I can pay back, maybe at least a few minutes, in the case of "I forgot my wallet in the car; gimme $1 I'll pay you back when we get there."

So, ... what can you do with 10k ETH that has to be paid back in the same minute? Well, you use it, I guess. It's not even a hacker, just someone playing within the rules of the code to use the ETH to do a transaction and make a profit.

These kind of things, will cause arbitration, and exchanges involved will eventually normalize the rates across all of them. I think that's a good thing. Also kinda forces liquidity issues to fix themselves.

[Kemarit]

Well, it's so sad other cryptocurrencies and other crypto platforms easily get hacked. The reason why Bitcoin seems so difficult to hack is because of the proof of work that needs to be done in order to hack. Also, Bitcoin has a very large community of honest miners who take huge interests in supporting the network other than just making quick gains because they all believe that bitcoin will see great heights in future.

Bitcoin has a very strong foundation and it doesn't take unnecessary risk, altcoins are constantly trying new technologies and techniques these have the risk of new vulnerabilities and unfortunately these still have a lot of funds and monetary value. I expect altcoins to continue to have large hacks and a lot of money stolen because it's the nature of the beast, new tech and money involved gives a great target for hackers.

This one, it was well structured from the very beginning, that's what the risk of being exploited is "almost" closed to 0 as compare to those altcoins who are built from ground up but haven't been fully tested.

And maybe this Defi has no use case at all, as pointed out by @Dabs, flash loans or whatever they call it and at the end someone will exploit it. And I don't think this is decentralized per se, because they can shut it down anytime, sounds like centralized by definition.

[squatter]

Wait a second. If someone can pause it, why is it part of defi? That sounds ironic to me. I would appreciate if someone could explain to me how is it decentralized.

"Non-custodial" might be a better description. The protocol is obviously at least partially centralized since it depends on bZx's centralized infrastructure. This distinction applies to most or perhaps even all "DeFi" and "DEX" platforms.

Maybe it was poorly designed, I myself has a very little understanding though, but as I have said in some of my post about this whole new Defi protocol, for me BTC is the only Decentralized Finance that is very much secure.

With complexity comes risk. Part of Bitcoin's strength is its simplicity: scripts cannot loop or recurse and there is no notion of "state." This is also extremely limiting from the perspective of coding smart contracts.

Ethereum allows for much greater contracting functionality while also increasing the risk of losses due to vulnerabilities and exploits.

[Zicadis]

Code is law.

Their protocol allowed for this kind of exploit to happen, now they'll learn to do better.

Over time, these types of black swan events and hacks will weed out all the structurally flawed projects. It's for the best in the long-run.

[joniboini]

I myself has a very little understanding though, but as I have said in some of my post about this whole new Defi protocol, for me BTC is the only Decentralized Finance that is very much secure.

If you only need a currency then it probably is, but the 'defi' space is much more than that. They want decentralized lending, funding, game, etc that needs complex 'smart contract' stuff. Basically, depends on what you need and what your purpose is, 'defi' can be interpreted as a simple decentralized money or a financial system.

[Bttzed03]

Iota did something similar to this (hitting pause button) a few days ago. Decentralized huh?

[mk4]

"Non-custodial" might be a better description. The protocol is obviously at least partially centralized since it depends on bZx's centralized infrastructure. This distinction applies to most or perhaps even all "DeFi" and "DEX" platforms.

Pretty much. These platforms keep on spewing the "decentralized" description even though it's really really misleading. Binance's ChangPeng Zhao admitted it himself. But I guess Non-custodial Finance "NoFi" doesn't sound as good?  

[hatshepsut93]

With complexity comes risk. Part of Bitcoin's strength is its simplicity: scripts cannot loop or recurse and there is no notion of "state." This is also extremely limiting from the perspective of coding smart contracts.

Ethereum allows for much greater contracting functionality while also increasing the risk of losses due to vulnerabilities and exploits.

Which is why it's a bit unfair to point out that Bitcoin is better than those things, because Bitcoin is not a DeFi, it's a cryptocurrency. What's actually important is that Bitcoin is a far better cryptocurrency than Ethereum, and sacrificing decentralization to achieve more features or scalability is unacceptable, especially if features like smart contracts are still yet to prove their real world usefulness.

[1Referee]

People have taken the defi hype a bit too far it seems. A lot of the applications running on top of Ethereum have nothing to do with defi, but they make it seem like that to surf on the hype and lure in users/capital. Most people are too stupid to do their own research and therefore take everything for granted.

If we zoom out and not react to everything from a 'Bitcoin good altcoin bad' narrative, there are plenty of actual defi applications running on top of Ethereum that are useful. Dexes for example, it's so easy and fast to exchange one token for another on the platform, which is what we all want to see happen on Bitcoin. Ethereum has it already.

Decentralized stablecoins on Ethereum is another one. I like the fact that the ERC20 ecosystem is so diverse yet so interoperable.

My only issue with Ethereum is that it keeps printing coins (no fixed supply). That's a fundamental aspect of that network I can't get over and therefore not own any.

[livingfree]

I use to see this kind of projects in the altcoins and they were boasting about this new kind of tech but I'm not impressed at all. This will be the same as the first ones that didn't find success in the cryptosphere.

They keep on renovating ideas that will be hype from the very start but once it's already launched and operating, the problem will pop out. DEFI, DEX or what they call it, that doesn't matter because they still have the control over it although we truly want pure and real decentralization being applied.

[arwin100]

Code is law.

Their protocol allowed for this kind of exploit to happen, now they'll learn to do better.

Over time, these types of black swan events and hacks will weed out all the structurally flawed projects. It's for the best in the long-run.

This is the honest truth but we haven't seen too many altcoins with advanced technology live a long life but that could be due to them just being new. It'll be nice to see how far some of them are  developed after they have been around for a decade.

Because all of the doesn't have long term support that's  why they fall down but some of them intentionally hype this up just to gather attention for scamming purposes but I really still want to see a new alts that have advance technology that will last long since if we keep seeing scams these days for sure it will affect all future projects.

I use to see this kind of projects in the altcoins and they were boasting about this new kind of tech but I'm not impressed at all. This will be the same as the first ones that didn't find success in the cryptosphere.

They keep on renovating ideas that will be hype from the very start but once it's already launched and operating, the problem will pop out. DEFI, DEX or what they call it, that doesn't matter because they still have the control over it although we truly want pure and real decentralization being applied.

Yeah the same as you I'm not impressed  with it since to much word is so bullshit and actually I want an actual result, and those DEFI and DEX thing is for me a accessory for them to get more attention and money for their projects.

[Tipstar]

One another function Defi promotes is involvement of holders in decision making. Which is not quite possible in Bitcoin. Though Bitcoin is a solid coin with possibly the most decentralized distribution and highest security against any kind of attacks, Defi are also certainly a thing. A new form of crypto that's less tested and tried.

[tbterryboy]

Well, it's so sad other cryptocurrencies and other crypto platforms easily get hacked. The reason why Bitcoin seems so difficult to hack is because of the proof of work that needs to be done in order to hack. Also, Bitcoin has a very large community of honest miners who take huge interests in supporting the network other than just making quick gains because they all believe that bitcoin will see great heights in future.

Bitcoin has a very strong foundation and it doesn't take unnecessary risk, altcoins are constantly trying new technologies and techniques these have the risk of new vulnerabilities and unfortunately these still have a lot of funds and monetary value. I expect altcoins to continue to have large hacks and a lot of money stolen because it's the nature of the beast, new tech and money involved gives a great target for hackers.

You’re very right, bitcoin is always better than all these alto pins. I can remember that when we had none of these Altcoins platforms things used to be a lot better and there wasn’t much scam projects because it wasn’t easy with bit coin, but ever since there was ethereum, it made things easy for people and they are now able to easily create lots of scam projects. Same thing with this case, if it was bitcoin it wouldn’t have been an easy thing for the scammers to do. Since it’s Ethereum, these hackers, they will always find their to dos something bad with it.

[Baofeng]

Just a quick update, Nexus Mutual, the one who handles the insurance for bZx, has covered some of them.  And there could be more claimants are going to be paid out and probably a good direction for those who are affected by the lost.



https://twitter.com/NexusMutual