Cryptocurrency has proven to be a boon to a lot of people. Since its creation, blockchain technology has grown far beyond the boundaries of what anyone could have thought possible. What began with a goal to simply facilitate online transactions has become gargantuan in scope and industries worldwide are now taking note with some even tentatively adopting it into their framework.
However, like anything else, it also has its underbelly. Investing in anything comes with added risk. Most of the time this risk comes in the form of your investment not performing well as your wide-eyed dreams told you it would. You might watch as the price falls when that one announcement you thought would take your investment to the moon fails to materialize until you’re left with no choice but to take the hit and exit at a loss. These sorts of dangers are expected, accounted for, and are natural.
What is unnatural is hackers. Like any budding industry, cryptocurrency has its faults and weaknesses. Also like any budding industry, there will always be people looking to exploit those weaknesses. This has given rise to an ever-increasing group of hackers within the crypto ecosystem constantly looking for projects with loopholes and backdoors that they can exploit. As the industry is currently worth trillions of dollars, successful hackers can make away with thousands and sometimes millions of dollars.
NFT-based Bug Bounties to Save the Crypto Ecosystem
On the flip side of the coin, white-hat hacking is becoming increasingly popular recently and cybersecurity protocol, Hats.finance is looking to leverage that popularity to progressively secure the blockchain. Hats.finance is a self-described bounty protocol for white-hat hackers and auditors that is trying to incentivize the entire blockchain against unethical hacking.
To bring this to practice, they are creating ‘vaults’ for projects that are willing to participate. These vaults will contain a specified amount of the project’s token and will serve as a bug bounty for hackers who discover exploits on the project. Combined with this they are also offering specific NFTs from popular blockchain artists to hackers and auditors that can help secure the blockchain.
It is essentially a straight-forward plan. Make securing the blockchain more appealing than exploiting it. The beauty here is in the simplicity of it. For those with the skills to steal funds, moving the contents of their loot off-chain and making it undetectable is harder than you might expect. Hats.finance is leveraging both this and its considerable rewards to essentially bring more hackers towards the side of ethical hacking. Black hat hackers will essentially be doing the same thing they had been doing previously but rather than taking the funds for themselves they will be turning them in for the contents of the vault and valuable one-of-a-kind NFTs
It might seem counterintuitive to allow people to hack your network in the hopes they will secure it more and sometimes it is. However, with the difficulty associated with moving funds off-chain as well as the potential for rewards, Hats.finance has greater possibilities of being successful where many others have failed.
NFTs Could Be The Lynchpin
When considering the fact that NFTs are currently selling for thousands and sometimes millions, a clearer picture begins to take shape. Many things on the blockchain are pushed forward by popularity and NFTs are no different. The amount of notoriety an NFT might gain for being associated with someone who saved a network from losing money could push that NFTs worth into millions of dollars potentially making it worth more than the exploit itself.
This of course is all circumstantial. It remains to be seen how this will all play out but the possibilities are majorly positive. If successful, this could be the beginning of far greater security for blockchain projects.