Crypto bridge hacks: What are they?
A crypto or blockchain bridge is a type of software that allows for the exchange of cryptocurrencies between different blockchain networks. While this type of software is incredibly useful, it's also vulnerable to an attack. In this article, we'll explore how crypto bridges can be hacked and what you can do to protect yourself.
How Crypto Bridges Work
Crypto bridges work by creating a "bridge" between two different blockchain networks. Blockchains within themselves lack interoperability, meaning that data from -- for example -- the Solana network is not compatible with that of Ethereum. However, bridges help to plug this cavity.
This bridge allows for the exchange of information and value between the two networks. For example, if you wanted to send Ethereum from one network to another, you could use a crypto bridge to do so. That is why tokens end up being "wrapped" -- meaning it represents a token from another blockchain.
As you might have gathered, crypto bridges are particularly useful for exchanging tokens between different blockchain protocols. For example, if you wanted to exchange an ERC20 token for an ERC721 token, you could use a crypto bridge to do so.
There are also different types of blockchain bridges:
- Unidirectional or one-way bridges: These allow you to send from one blockchain to the other, but cannot work vice-versa.
- Bidirectional or two-way bridges: These types of bridges allow you to convert to and from different blockchains.
Furthermore, bridges can also be custodial or non-custodial.
Because crypto bridges facilitate the transfer of information and value between different networks, they are also vulnerable to attack. Let's take a look at how crypto bridges can be hacked.
How can Crypto Bridges get Hacked
Unfortunately, crypto bridges are susceptible to hacks. In fact, one of the popular blockchain bridges, Wormhole, was hacked for $326 million back in 2nd February 2022. The biggest hack occurred on Ronin bridge, which was exploited for over $600 million. Indeed, bridges have been highlighted as one of the weakest links of blockchains (ie. they are susceptible to attacks) in 2022.
The complexity of cross-chain functionality is one of the issues that lead to bridge attacks. Social Engineering and phishing are one of the ways that attackers can conduct their malicious acts, as was the case with the Ronin network. In fact, "five of the bridge's nine validator nodes were compromised in a phishing attack". The age-old tricks keep working. Prevention and defense were highlighted as some of the main factors which could contribute to fewer bridge attacks occurring.
In the end, bridges need to be carefully analyzed by analysts so that they make sure the digital assets are reaching the correct recipient (especially when a large amount of money is involved) and that there are no coding glitches that allow for exploits to occur.
If you're using a crypto bridge, always double-check that your transactions are going to the intended recipient before sending them. Furthermore, make sure that you're using a reputable crypto bridge provider that takes security seriously.
Crypto bridges are incredibly useful pieces of software that allow for the exchange of cryptocurrencies between different blockchain protocols. However, because they facilitate the transfer of information and value between different networks, they are also vulnerable to attack.