Poly Network hack puts DeFi fraud under the microscope

In one of the biggest crypto thefts ever, nearly $600M in crypto was stolen in a cyberattack on a decentralized finance (DeFi) platform called Poly Network.

Why should we care?
The hack highlighted security vulnerabilities associated with DeFi networks, which are financial applications in cryptocurrency or blockchain that are aimed at disrupting financial intermediaries. Poly Network enables interoperability between different blockchains so they can work together. While DeFi platforms could be used to streamline financial activities, they aren’t immune to cyberattacks. A report suggests DeFi-related hacks totaled $361M — an increase of nearly three times from all of 2020 – and DeFi-related fraud is also growing. In an unusual turn of events, however, nearly half of the stolen crypto was returned by Wednesday after Poly Network established contact with the hackers. By the end of the week, nearly all the funds stolen during the hack had been returned. A person claiming to be the hacker said they did it “for fun.” In a rationale for returning the funds, the person said “That’s always the plan! I am _not_ very interested in money! I know it hurts when people are attacked, but shouldn’t they learn something from those hacks?”