Page 133 - Cyber Defense eMagazine March 2024

Decoding the Cybersecurity Implications of

Decentralized Finance (DeFi)

Blockchain users’ blind faith in the system isn’t paying off

By April Miller, Managing Editor, ReHack Magazine

While decentralized finance (DeFi) is still relatively new, it is well-established enough that its
cybersecurity weaknesses have become clear. While it’s a promising technology, the implications for
users are significant.

What Is Decentralized Finance?

DeFi is an emerging financial ecosystem. It sidesteps centralized, regulated institutions like banks by
leveraging blockchain and cryptocurrency solutions. Since it relies on distributed ledger technology, it
enables dispersed peer-to-peer interactions.

People recognized blockchain’s potential in finance almost immediately after its development. While
adoption is slow, it has been catching on. Experts predict its penetration rate will increase from 0.25% in
2024 to 0.28% by 2028. Unfortunately, many of its underlying cybersecurity issues weren’t realized until
recently since it's a relatively new technology.

Cyber Defense eMagazine – March 2024 Edition 133
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