Can DeFi still be trusted??

[Jaered]

Decentralized Finance is one hell of a ride in crypto. It is the Wild Wild West of the Wild West. I was recently hacked and $5000 worth of tokens stolen from my staked wallet. While I may take much of the blame, I still think the DeFi protocol Crystl Finance has to be blamed

[shavebob77]

Yes,as long as we implement self-custody education and anti-scam ways,awareness is key.

[Xal0lex]

DEXs have so many limitations which make them look inferior to their centralized counterparts. Why would people use something that's slow, has low liquidity, and requires some level of technical knowledge (especially keeping self-custody of your coins)? We can't think about DEXs replacing CEXs if such limitations exist. While developers have been improving DEXs over time, they still have a load road ahead before they become mature for mainstream use.

At least, we're not tied to a single option. We have many alternatives to choose from, so it's likely crypto will move on from the FTX collapse and emerge bigger and stronger than ever. Who knows what the future holds for crypto/Blockchain tech? Just my thoughts

DEX has never been a full-fledged replacement for CEX. DEXs risk becoming fully regulated in the future. If we look at Uniswap and their EIP-1153, these fears are not unfounded. Read the post on Twitter at https://twitter.com/adamscochran/status/1602087890686775296. It says that Uniswap may launch some KYC in its next iteration, its fourth. If that happens, it will completely overturn all the usual ideas about DEX.

[o48o]

DEXs have so many limitations which make them look inferior to their centralized counterparts. Why would people use something that's slow, has low liquidity, and requires some level of technical knowledge (especially keeping self-custody of your coins)? We can't think about DEXs replacing CEXs if such limitations exist. While developers have been improving DEXs over time, they still have a load road ahead before they become mature for mainstream use.
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Right, there indeed is the learning curve for unneccearily complicatez tech when it comed to tech but se can Day this for most things in crypto including wallets. Things have been changing for the better. Before metamask it would have been nearly impossible for adoption, and whole metamask has become better, it's still suspicious and unfamiliar to regular people.

DEX has never been a full-fledged replacement for CEX. DEXs risk becoming fully regulated in the future. If we look at Uniswap and their EIP-1153, these fears are not unfounded. Read the post on Twitter at https://twitter.com/adamscochran/status/1602087890686775296. It says that Uniswap may launch some KYC in its next iteration, its fourth. If that happens, it will completely overturn all the usual ideas about DEX.

Dexes will become regulated there's no question about that. That however doesn't need to take away decentralized tech under it.

[kzkazu]

Defi can't always be trusted by so many bad stories happened with the defi these days. I meant if we must aware with the fact that if defi can't sustain due to the various reason. Celcius has been giving us a very good lesson even a big defi can't even survive when it was coming to the margin call and low liquidity caused by being drained by someone who has been borrowing bunch of liquidity from the defi itself. I can say that if defi can't fully be trusted but trusting defi is still good for now.

No exchange can be trusted. DeFi cannot be trusted, it does not have complete security guarantees. Although the defi project provides anonymity, it is still risky and vulnerable to hackers.

[Semar Mesem]

Yes,as long as we implement self-custody education and anti-scam ways,awareness is key.

That's right, always be vigilant and don't easily believe in a Defi project that doesn't have a reputation, let alone haven't passed an audit so that it makes us regret it, I think Defi still has good prospects in the future so we should invest money in many Defi projects.

[goldkingcoiner]

The only reason why Defi is acceptable in the eyes of most coiners is the fact that its so easy to use to swap for wrapped tokens. That way you can keep your funds out of an exchange and be completely self reliant. No third party is involved in your trades or your wallet holdings.

The bad news is that the underlying blockchain (BEP20 or ERC20 for example) is not as trustworthy or reliable as Bitcoin blockchain. And obviously it is not one and the same thing.

Its like giving someone a piece of paper with "1 Bitcoin" written on it and the person reassures you that that paper can be traded in for 1 Bitcoin at any time, as the piece of paper itself has an underlying Bitcoin reserve value. But its still not 1 Bitcoin. Just a voucher for 1 Bitcoin.

Should the underlying DeFI's blockchain fail for some reason, your wrapped token will become worthless and nobody will trade you 1 Bitcoin for it....

So whether or not you want to trust Defi is up to you. But one thing is certain: DeFi itself is trustless and verifiable. Just not without risk, depending on which blockchain you use.

[Abiky]

The only reason why Defi is acceptable in the eyes of most coiners is the fact that its so easy to use to swap for wrapped tokens. That way you can keep your funds out of an exchange and be completely self reliant. No third party is involved in your trades or your wallet holdings.

The bad news is that the underlying blockchain (BEP20 or ERC20 for example) is not as trustworthy or reliable as Bitcoin blockchain. And obviously it is not one and the same thing.

Its like giving someone a piece of paper with "1 Bitcoin" written on it and the person reassures you that that paper can be traded in for 1 Bitcoin at any time, as the piece of paper itself has an underlying Bitcoin reserve value. But its still not 1 Bitcoin. Just a voucher for 1 Bitcoin.

Should the underlying DeFI's blockchain fail for some reason, your wrapped token will become worthless and nobody will trade you 1 Bitcoin for it....

So whether or not you want to trust Defi is up to you. But one thing is certain: DeFi itself is trustless and verifiable. Just not without risk, depending on which blockchain you use.

That's certainly true, mate. Most underlying blockchain networks aren't as decentralized as one thought they would be. They're extremely vulnerable to hacks and/or manipulation because of their focus on performance instead of security/reliability. There's no guarantee your balance will always be there on a "De-Fi" platform of your choosing whose underlying blockchain network is centralized. While Ethereum is the most decentralized blockchain network after Bitcoin, that doesn't mean it's perfect.

You're going to have to decide whenever you'd want to put all of your money on "De-Fi" or banks. The latter is a much safer option, although rates are lower than those provided by "De-Fi" platforms. At least, we have an alternative to traditional banking. As long as we have Bitcoin, nothing else matters. Just my opinion

[Jackl87]

another bad day for inverse finance, they got exploited for $1.2 million. due to this news INV token trading volume dropped drastically (72%).
whether vulnerabilities to exploits in DeFi make investor funds insecure?  
if you have invested in DeFi token please give your opinion!

It is not a surprise that the price of that token drops if their website and services have been hacked or exploited. I don't really know how exactly the exploit worked that got those hackers those 1,2 Million$ but in the end it doesn't matter to me. For me Defi is still the future of finance and one of the driving forces for crypto adoption becaues decentralization is the main thing why Bitcoin (and therefore the whole crypto space) was invented in the first place.
I have some funds on a yield farm, that is also audited, but i am also aware that an audit does not mean that my funds are 100% safe all the time. As long as it is programmed, it can be hacked.

[o48o]

Finding loopholes in these smart contracts is not easy and spending about 900 Ethereum trying to exploit them suggests that people have a connection to the smart contract developers, which ultimately proves that the word “decentralized finance” is for media propaganda as these platforms are completely centralized.
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Ok, maybe i am losing something in here in translation but please explain what you mean, because i don't get how you took that leap. If people (i am assuming by people you mean hackers) had a connection to the smart contract developers, why would they need to use 900 eth for exploit? And how in earth one exploit would make them all centralized?

Or if you are using argument that "because of PoS it's centralized", that wouldn't have anything to do with this exploit either, right?

[AmoreJaz]

another bad day for inverse finance, they got exploited for $1.2 million. due to this news INV token trading volume dropped drastically (72%).
whether vulnerabilities to exploits in DeFi make investor funds insecure?  
if you have invested in DeFi token please give your opinion!

It is not a surprise that the price of that token drops if their website and services have been hacked or exploited. I don't really know how exactly the exploit worked that got those hackers those 1,2 Million$ but in the end it doesn't matter to me. For me Defi is still the future of finance and one of the driving forces for crypto adoption becaues decentralization is the main thing why Bitcoin (and therefore the whole crypto space) was invented in the first place.
I have some funds on a yield farm, that is also audited, but i am also aware that an audit does not mean that my funds are 100% safe all the time. As long as it is programmed, it can be hacked.

high likely that it is an inside job. the defi system itself is great, but it is the developers that are making this system full of fraudulent activities.most of these hacks i believe are inside job. remember, mostly are anonymous projects, so hard to trace who is doing such kind of move. the devs pocketed already what they need so they won't care if their token will go down hard or won't survive. this is the problem of most defi investors, they have no clue if the platform will survive long or not.

[Xal0lex]

That's certainly true, mate. Most underlying blockchain networks aren't as decentralized as one thought they would be. They're extremely vulnerable to hacks and/or manipulation because of their focus on performance instead of security/reliability. There's no guarantee your balance will always be there on a "De-Fi" platform of your choosing whose underlying blockchain network is centralized. While Ethereum is the most decentralized blockchain network after Bitcoin, that doesn't mean it's perfect.

You're going to have to decide whenever you'd want to put all of your money on "De-Fi" or banks. The latter is a much safer option, although rates are lower than those provided by "De-Fi" platforms. At least, we have an alternative to traditional banking. As long as we have Bitcoin, nothing else matters. Just my opinion

Are there still really decentralized networks in DeFi? In my opinion, this is already more fiction than truth. In most protocols, the main supply of tokens is owned by a few addresses who can control the protocol, or manipulate the prices. Anything PoS is no longer decentralized. In addition, PoS is very prone to all kinds of attacks and exploits, which happen almost every day.

[laylagur]

DeFi platforms are still subject to hacks and attacks, even after passing security audits. Some teams seek to secure user funds or recover losses, but there is no complete guarantee of security. As DeFi projects increase, there will also be more hacks despite advances in technology and security, so either take the risk or don't invest.

Why are DEFI projects frequently visited by hackers? The audit has also passed, why are there still loopholes? Why are there no white hats? It's all about hackers stealing user funds.

[Abiky]

Are there still really decentralized networks in DeFi? In my opinion, this is already more fiction than truth. In most protocols, the main supply of tokens is owned by a few addresses who can control the protocol, or manipulate the prices. Anything PoS is no longer decentralized. In addition, PoS is very prone to all kinds of attacks and exploits, which happen almost every day.

I think the only truly decentralized "De-Fi" network is Ethereum Classic as it's the only smart contracts platform that uses good-old PoW. The rest are just centralized shitcoins with PoS as their consensus layer. It's a pity to see many "De-Fi" platforms sacrificing their decentralization just to obtain performance and cost-efficiency. They've decided to please the government by doing the switch to PoS without considering the long-term risks of doing so. With a single point of failure, we should expect more losses in the long run.

I'd only trust "De-Fi" platforms that are truly decentralized and have been tried and tested by the developers. As I've said before, ETC is a good option. It's just that dApps are virtually non-existent on it. Maybe someday developers will have a look at it? Just my thoughts

[zasad@]

Are there still really decentralized networks in DeFi? In my opinion, this is already more fiction than truth. In most protocols, the main supply of tokens is owned by a few addresses who can control the protocol, or manipulate the prices. Anything PoS is no longer decentralized. In addition, PoS is very prone to all kinds of attacks and exploits, which happen almost every day.

I think the only truly decentralized "De-Fi" network is Ethereum Classic as it's the only smart contracts platform that uses good-old PoW. The rest are just centralized shitcoins with PoS as their consensus layer. It's a pity to see many "De-Fi" platforms sacrificing their decentralization just to obtain performance and cost-efficiency. They've decided to please the government by doing the switch to PoS without considering the long-term risks of doing so. With a single point of failure, we should expect more losses in the long run.

I'd only trust "De-Fi" platforms that are truly decentralized and have been tried and tested by the developers. As I've said before, ETC is a good option. It's just that dApps are virtually non-existent on it. Maybe someday developers will have a look at it? Just my thoughts

I think that the work of smart contracts does not depend on the algorithm of the coin. If hackers find vulnerabilities in the smart contract, then you will also lose your investment. The average user will not get their money back in most cases, so I always say the benefit of earning 10-15% per year does not cover the risk of losing 100% of the investment.

[doomloop]

I think that the work of smart contracts does not depend on the algorithm of the coin. If hackers find vulnerabilities in the smart contract, then you will also lose your investment. The average user will not get their money back in most cases, so I always say the benefit of earning 10-15% per year does not cover the risk of losing 100% of the investment.

The good thing you could do with this is not to put all your money into a single thing. If you do that then you are right that it will not be recovered and you will lose all your money, but if you do not do that and instead you put like 5% of your money into a single thing then the worst case would be losing 5% of your portfolio, the other 95% will be safe.

The exception being bitcoin because investing into bitcoin is a good way of making money when bull run comes, but for all the other defi type of stuff, you should have bunch of diversification so that you wouldn't lose all your money in a single day. That's my understanding though, maybe it won't work that well.

[PhygiCards]

Yes,as long as we implement self-custody education and anti-scam ways,awareness is key.

That's right, always be vigilant and don't easily believe in a Defi project that doesn't have a reputation, let alone haven't passed an audit so that it makes us regret it, I think Defi still has good prospects in the future so we should invest money in many Defi projects.

DEFI protocols emerge in endlessly, especially in the bear market of 2022, various hackers and various loopholes continue to appear in everyone's field of vision and news. What I want to say is that there are so many DEFI protocols and various tokens, and you need to find out by yourself Discrimination, of course, the greater the risk, the higher the return. This is entirely up to personal decision. Of course, apart from hackers being an important role of DEFI, I think project founders are also an important factor, because many founders have evil intentions.

[Abiky]

I think that the work of smart contracts does not depend on the algorithm of the coin. If hackers find vulnerabilities in the smart contract, then you will also lose your investment. The average user will not get their money back in most cases, so I always say the benefit of earning 10-15% per year does not cover the risk of losing 100% of the investment.

Of course. Smart contract vulnerabilities would bring a lot of risks to "De-Fi" users. But the situation becomes worse if the underlying Blockchain network's consensus algorithm is centralized. If we want full decentralization and security/reliability, we're going to need to focus on all aspects of the blockchain (both the consensus layer and the smart contract itself).

Honestly, I don't think any other smart contract platform is as reliable and decentralized as Ethereum. That doesn't mean "De-Fi" apps built on ETH won't have their flaws, but at least they will be much safer than those built on rival chains such as BNB or Solana. Blockchain tech is all about being trustless, so people would just need to verify the code and check for transactions just to be safe. Just my opinion

[nakamura12]

Decentralized Finance is one hell of a ride in crypto. It is the Wild Wild West of the Wild West. I was recently hacked and $5000 worth of tokens stolen from my staked wallet. While I may take much of the blame, I still think the DeFi protocol Crystl Finance has to be blamed

That's because a hacker just found a vulnerability from that DeFi you invested although there could be other DeFi that can be trusted but the question is, How to find that DeFi where we can trust?. I am sure you know that there are different DeFi projects that pop-up out of nowhere and each of us have our own specific ways on what to trust like a DeFi platform that is truly decentralized rather than being a centralized platform.

[bhooscream]

another bad day for inverse finance, they got exploited for $1.2 million. due to this news INV token trading volume dropped drastically (72%).

whether vulnerabilities to exploits in DeFi make investor funds insecure?  

if you have invested in DeFi token please give your opinion!

For certain big projects, DeFi maybe still able to compete with other crypto business, but, not all DeFi projects will be able to survive during this bearish market. Moreover, DeFi era seems ended after some times and we will possibly find or meet with other hype project types again later. So, I am not willing to choose investment in DeFi again right now because it is too risky. Although we don't know what will happen to DeFi era in the next bullish moment, we can see and consider if this sis till profitable or not for certain DeFi tokens or coins. Exactly, this will also depend on how teams are developing their projects to be up-to-date and accepted by the global communities widely and generally.