Hackers stole an estimated $1.7 million in NFTs, or non-fungible tokens, from users on the crypto-trading platform OpenSea on Feb. 19.
They did so by exploiting the Wyvern Protocol, the open-source standard underlying most NFT smart contracts. OpenSea victims authorized partial contracts which could later be altered, allowing the hackers to transfer NFT ownership without payment.
While this theft is small compared with recent high-profile hacks, a report from Chainalysis found that criminals stole an estimated $14 billion in cryptocurrencies in 2021 – an 80% rise from the previous year. If the security issues in this market persists, it could stifle mainstream adoption of this technology.
The popularity of NFTs has skyrocketed in the last several years, growing in market size from $106 million in 2020 to $44.2 billion in 2021. It's only natural that a rise in crime proceeds. This doesn't mean the DeFi space shouldn't be used, though; platforms simply need to take a more stringent approach to security.