Report finds majority of DeFi exchanges have poor security

Published on by Cryptoslate | Published on

The ease of listing DeFi tokens on Uniswap and other DEXs, which require no listing fees or centralized review processes, have led to an increase in malicious actors targeting gullible investors with attractive token schemes.

Might be lagging behind in terms of security and safety features - with a majority falling on an independent audit carried out by Cer Live and published by crypto-security firm Hacken.

The team assessed 25 popular DEXs and found 14 such bourses to be lagging in several measures.

A score from 1-10 was then prepared on the various factors, with ratings from 8-10 suggesting a "Good" DEX, 6-8 a favorable DEX, and anything below 6 to be "Unsafe."

Other popular DEXs like Sushi, 1inch, and Balancer came out in the middle of the ratings, with 6.4 and 6.35 each respectively.

No individual explanation for the lower ratings was provided.

On the lower-end, DEXs deemed "Unsafe" saw big names like Bancor and Loopring - despite both raising millions of dollars in ICOs in 2017.

The absolute lowest rating was given to Forkdelta, which boasted the lowest security score, the lack of audits and bug bounty, and little data on liquidity.

"We encourage all DEX platforms to comply with best practices and perform security audits after each significant software update and also maintain a bug bounty program to get reports from third-party security researchers."

The DEX ratings show that the DeFi market, despite its popularity and coming-of-age, leaves much to desire from the standpoint of competing with centralized exchanges.