KEY POINTS
- The DualDefense model empowers joint efforts with the community toward better security in the space
- Through the Flash Pool, white hat hackers can earn rewards for a 'clean' code review
- There are no added costs for clients, and $HAI stakers can earn up to 180% APY
In the hustle world of cryptocurrency and decentralized finance (DeFi), security has largely become a key point of discussion across communities that seek stronger, more secure channels for their transactions and engagements in the digital economy.
As the cryptocurrency sector's vulnerability to exploits is exposed by fraudsters and malicious actors, leading blockchain security auditor Hacken enters the picture with an upcoming, game-changing platform: DualDefense Flash Pools.
What is DualDefense Flash Pools?
DualDefense Flash Pools is a platform that "combines real yield with community-driven security enhancements in DeFi." It seeks to address the shortcomings in the sector through sustainable financial models and robust security measures.
In a nutshell, the DualDefense model allows clients to request an audit from Hacken. The firm then conducts a thorough security assessment of the client's project code. Once the audit is completed, Hacken will open a 30-day smart contract-based DualDefense Flash Pool, which includes a USDC contribution from the Hacken team into the Flash Pool.
Holders of the HAI token can stake their tokens under the campaign. From the HackenProof platform, independent security researchers will be invited to review the code, and if any critical vulnerabilities are discovered, the researchers will earn rewards from the Flash Pool.
In an exclusive with International Business Times, Hacken co-founder and CEO Dyma Budorin shared how the DualDefense model can help empower independent crypto security researchers to be rewarded for their efforts in enhancing security in the DeFi space.
Tomorrow, our @buda_kyiv takes the stage at #CCATokenSummit to tackle Cybersecurity and Regulations.
— Hacken🇺🇦 (@hackenclub) October 2, 2024
This talk will dive deep into the issues plaguing Web3 and explore why it’s up to builders, not just regulators, to drive meaningful change. Discover how smart regulation can… pic.twitter.com/IrHVs8TtYx
A First-of-Its-Kind Campaign for Enhanced Crypto Security
The DualDefense Flash Pools campaign is expected to boost the number of post-audit crowdsourced verifications, "and for the first time ever, we enable the crypto community to drive this positive change," Budorin said.
It's a win-win situation for stakeholders – clients will benefit from enhanced security and comprehensive protection at no added costs, while HAI stakers can earn up to a whopping 180% APY (annual percentage yield) from the Flash Pool.
Instead of returns being generated from inflationary token emissions, users benefit from real market activity, which marks the transition of DeFi toward more sustainable financial models.
For the first time, Hacken is introducing a prediction market that's tied to audit verification. Traditional prediction markets are associated with speculative activities, but the platform was designed to provide real-world utility for decentralized security practices.
In essence, users who stake in the Flash Pool are betting that Hacken has performed a thorough audit of the project. Each Flash Pool grows as the crypto community stakes HAI, which will, in turn, motivate white hat hackers to join the code audit verification. Such an approach not only improves code security in the space but also offers competitive profitability for white hats.
Budorin noted that Hacken is "open to feedback" in the vast world of Web3. "We put our skin in the game, bold enough to reveal the results of our work. We're committed to transparency and trust, striving to improve the industry by making bug bounties accessible to all, even the smallest projects that previously couldn't afford it – a win-win-win situation for all parties involved," he said.
Incentivizing the Industry Contributions of White Hats
White hat hackers, often also called "ethical hackers," who are tapped to detect system issues before "black hat" hackers get to them, are traditionally paid only if they detect a bug. Hacken is changing the game forever for white hats, allowing them to "earn rewards for a 'clean' code review."
Under the DualDefense Flash Pools platform, white hats can review a project's code, verify if the code is bug-free, and stake their own tokens to earn real yield APY.
"This truly groundbreaking approach incentivizes them to ensure security, whether they find vulnerabilities or not, which is a massive shift from the traditional bug bounty model," Budorin said.
The platform is expected to go live in the next few weeks.
The Role of Hacken in Bridging the Web2—Web3 Gap
Chainalysis previously reported that more than a billion dollars was lost to hacks and security breaches in DeFi protocols last year. Such exploits are still a persisting problem in the sector in 2024.
Hacken's research revealed that only 5% of the staggering $463 million stolen from the crypto market in the third quarter of 2024 has been recovered, further proving the urgency for community-wide efforts to enhance DeFi infrastructure and crypto project code security.
Budorin admitted that the biggest hurdle for broader Web3 adoption is the high rate of scams and hacks. In Web3, users can irreversibly lose their digital assets to malicious actors, which naturally makes Web2 investors uncomfortable.
"Any effort to address this appalling state will help bridge the gap, but DualDefense Flash Pools also brings something that even Web2 lacks: an approach where security is decentralized, as auditors, the community, and independent security researchers all team up (each driven by their own reasons) to battle-test the code," he said.
Budorin believes that the new model's introduction into the space is a crucial milestone that will reduce the number of security incidents that have become "so costly to Web3's reputation."
Hacken's upcoming tool signifies a bold move for a reputed security auditor in Web3, but Hacken is willing to put its reputation on the line all for the sake of raising security standards across the space, and, in turn, creating an environment where investors can rest assured their crypto assets are safe.
