Jack Kubinec

<div id="highlights-block_62bc42c09b064" class="highlights">
 <ul>
 <li>Few DeFi companies employ dedicated security personnel</li>
 <li>Industry experts believe bridges will become more secure as DeFi matures</li>
 </ul>
 
</div>



As investment in cryptocurrency grows, so does the incentive for criminal actors to exploit the DeFi (decentralized finance) space. Cross-chain bridge hacks have been the weapon of choice for crypto thieves in 2022. Bridge hacks have accounted for more than a billion dollars in stolen funds this year, according to research from blockchain analytics and compliance firm Elliptic.



Cross-chain bridges allow assets to be moved between different blockchain protocols, meaning the networks contain a large concentration of crypto assets. The recent string of bridge attacks has caused some industry leaders to question whether the benefits of bridges outweigh their risks. A top analyst at Elliptic believes bridge hacks are just growing pains that DeFi will eventually surmount.



<a href="https://cms.blockworks.co/defi-cross-chain-horizon-bridge-hacked-for-100m/" target="_blank" rel="noreferrer noopener">Harmony</a>, <a href="https://cms.blockworks.co/sky-mavis-ronin-network-bridge-exploited-for-over-600m/" target="_blank" rel="noreferrer noopener">Sky Mavis</a>, and <a href="https://cms.blockworks.co/in-second-largest-defi-hack-ever-blockchain-bridge-loses-320m-ether/" target="_blank" rel="noreferrer noopener">Wormhole</a> all suffered blockchain exploits exceeding $100 million this year. Mudit Gupta, Chief Information Security Officer at Polygon, believes bridge insecurity is an industry-wide problem.



“Most of the hacks are happening due to companies not having proper security experts and not knowing what to do themselves,” Gupta said in a Twitter DM. “There are very few DeFi companies with [dedicated] security personnel.”



DeFi protocols have proliferated rapidly in the past six years, but security infrastructure has not kept up with the now over-$900 billion industry. For this reason, hacks totaling in the hundreds of millions are not surprising.&nbsp;



On April 1, a trader tweeted their concern that a major Harmony Horizon Bridge exploit would only require a hacker to obtain two of the protocol’s five validator keys. In June, that exact scenario occurred — and Harmony was ransacked for $100 million.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Since the current narative du-jour is bridges &amp; bridge hacks, I wanted to do some digging on the harmony bridge on Ethereum which secures ~$330m worth of tokens.&mdash; Ape Dev (@_apedev) <a href="https://twitter.com/_apedev/status/1510007663832223751?ref_src=twsrc%5Etfw">April 1, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Vitalik Buterin, co-founder of Ethereum, believes cross-chain bridges are inherently prone to security breaches.



“The fundamental security limits of bridges are actually a key reason why…I am pessimistic about cross-chain applications,” Buterin wrote in a lengthy January Reddit post. The influential founder went on to express his belief that assets should be held in the same blockchain ecosystem, rather than shuffled between chains.



Tara Annison, Head of Technical Crypto Advisory at the crypto research firm Elliptic, disagrees.



“We’re not going to live in a single chain world,” Annison said. It will always be necessary to move assets between blockchains, so “we shouldn’t characterize bridges in general as bad just because some have been hacked.”



Annison believes bridge hacks are caused by the concentration of value within cross-chain bridges, not by the bridges themselves.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“If you think of wars, you try to bomb bridges to stop goods and services moving across,” Annison said. Recent cross-chain bridge hacks are not happening “because bridges are inherently weak infrastructure, it’s because they have a concentration of value.”</blockquote>



Annison believes that all crypto assets come with risk, and bridges are just the risk “flavor of the month” following stablecoins in May and NFTs before that. Bridges should become more secure as protocols become more technologically mature.



It remains to be seen if market participants agree.



Sky Mavis’ Ronin Bridge, which was compromised for $625 million in April, <a href="https://cms.blockworks.co/sky-mavis-reopening-ronin-bridge-with-enhanced-security/" target="_blank" rel="noreferrer noopener">reopened</a> this morning. Close to $9 million in assets have already left the chain, according to Messari.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.

Cross-chain Bridge Thefts Top $1B in 2022

Ben Strack

<div id="highlights-block_623db5c6dfc0b" class="highlights">
 <ul>
 <li>Former legal counsel at Deutsche Bank joins Amber Group</li>
 <li>Ethereum scaling platform Polygon names a new chief information security officer</li>
 </ul>
 
</div>



Anthony Mazzarese and Brandon Mulvihill have left financial services company Jefferies to co-found a startup aiming to serve institutional clients in the crypto space.&nbsp;



Mazzarese was Jefferies’ global head of FX prime brokerage distribution, while Mulvihill served as its global head of FX prime brokerage. The two will now focus on bridging the gap between traditional financial services and digital assets through industrial-grade technology, trade flow expertise and attractive commercial terms, Mazzarese told Blockworks.



The former Jefferies executives are building a team and securing funding, he added. Additional details about the startup are set to come in the next few weeks.



Digital asset platform Amber Group appointed Ehsan Haque as its general counsel for Europe, Middle East and Africa (EMEA).



Haque joins Amber Group from his latest role as global head of legal and compliance for private equity firm Hamilton Capital Holdings. He has also recently worked as general counsel for investment technology platform AlphaSwap and Lending Block, an online digital asset lending and borrowing platform.&nbsp;



Earlier in his career, Haque was legal counsel for Deutsche Bank. He later joined Royal Bank of Scotland and was head of equities for Nomura’s EMEA legal department.



The hire follows Amber Group’s <a href="https://cms.blockworks.co/crypto-trading-platform-amber-group-eclipses-3b-valuation-with-latest-raise/" target="_blank" rel="noreferrer noopener">latest $200 million raise</a> last month led by Singaporean state holding company Temasek, giving the company a valuation of roughly $3 billion.



Web3 digital identity platform Unstoppable Domains hired Sajjad Rehman as its head of Europe and Nilkanth Iyer as its head of Asia.



Launched in 2018, Unstoppable Domains allows anyone to purchase a domain name that is minted as an NFT on the blockchain. It has more than 2 million registered NFT domains.



Rehman joins from Amazon-owned video livestreaming service Twitch, where he was vice president of business development for the EMEA region. Iyer previously held roles at software intelligence company CAST and tech goliath IBM.



The two executives will seek to help Unstoppable Domains onboard millions of new users to Web3 by partnering with wallets, exchanges and other industry players in Europe and Asia.



Mudit Gupta recently announced on Twitter that he would be joining Polygon as its chief information security officer.



Gupta also serves as an advisor at SushiSwap and a technical partner at Delta Blockchain Fund, according to his LinkedIn profile. He had worked for nearly three years as a senior solidity developer and then lead blockchain engineer for software development company Polymath.



“Polygon is the leading Ethereum scaling platform, and I&#8217;m stoked about our upcoming ZK rollups,” Gupta said in <a href="https://twitter.com/Mudit__Gupta/status/1505918543766122500" target="_blank" rel="noreferrer noopener">a Monday tweet</a>. “Security has been a priority at Polygon, and I will be pushing it to the next level.”



Decentralized financial market infrastructure company Bosonic hired Paddy Boyle as its global head of clearing and derivatives. Founded in 2016, the firm offers infrastructure aiming to eliminate counterparty credit and settlement risk in digital asset markets.&nbsp;



Boyle was previously a partner at Goldman Sachs, where he spent 16 years as the investment bank’s global head of foreign exchange options. More recently, he was a managing director and global head of ForexClear at London-based clearing house LCH.



Former Treasurer of the United States Rosie Rios joined the board of directors of Unicorn Hunters, a platform that connects companies looking for expansion capital to achieve a billion-dollar valuation.



Rios’ experience will be key to Unicorn Hunters achieving its strategic objectives, which include making Unicoin the top equity-backed cryptocurrency in the world, the company announced Wednesday.



Unicoin, which <a href="https://www.prnewswire.com/news-releases/unicorn-hunters-introduce-unicoin-an-equity-backed-dividend-paying-cryptocurrency-as-a-solution-to-the-high-volatility-of-traditional-cryptocoins-301488540.html" target="_blank" rel="noreferrer noopener">launched last month</a>, pays dividends and is backed by equity in emerging high-growth companies.&nbsp;



The RLY Network Association hired Jeremiah Owyang as its chief marketing officer.



The non-profit supports the infrastructure and development of the RLY Network, which powers projects including Rally.io, Unite.io and SuperLayer.io.



Owyang is an advisor and angel investor in several early-stage startups, including blockchain gaming giant <a href="https://cms.blockworks.co/metaverse-will-empower-creators-ceo-says/" target="_blank" rel="noreferrer noopener">Animoca Brands</a>. He also founded Catalyst Companies, a council for corporations that are seeking to innovate with new technologies.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.