Recently, the DeFi sector experienced another major security incident when the uniBTC contract in the Bedrock protocol was attacked, resulting in hackers stealing over $2 million in assets. This incident highlights the inherent risks in DeFi projects and underscores the critical need for robust auditing to protect users’ assets.
At LayerPixel, we recognize that such threats are not isolated incidents but ongoing challenges that DeFi projects must confront. The foundation of our security strategy lies in comprehensive risk management and rigorous auditing processes.
The Necessity of Smart Contract Auditing
Smart contracts serve as the backbone of DeFi projects, managing users’ funds, data, and trust. They execute automatically on the blockchain without intermediary intervention, but because they are driven by code, they can harbor vulnerabilities or logic errors. Therefore, smart contract auditing is an indispensable component for all DeFi projects.
The primary purpose of auditing is to engage professional third-party firms to verify the code of smart contracts, ensuring they are free from security vulnerabilities and function as intended. The audit process can be broken down into several key components:
- Static Analysis: This is the initial step in the audit process, where auditors conduct a comprehensive review of the smart contract code. This includes checking the logical structure and using automated tools for vulnerability scanning. Static analysis effectively identifies common security issues such as reentrancy attacks, overflows, and logical vulnerabilities.
- Dynamic Testing: Beyond code inspection, auditing also involves dynamic testing, which simulates contract operations in real-world scenarios. This helps reveal potential risks by simulating various transactions, inputs, and conditions, ensuring the contract can handle diverse situations safely.
- Functional Verification: This component verifies that the logic of the smart contract is correct and operates as designed. Auditors focus on confirming the accuracy of different functions in the contract to prevent fund losses due to code errors.
- Security Vulnerability Detection: A core aspect of the audit process, this involves using automated tools and manual inspections to uncover exploitable vulnerabilities, such as re-entrancy attacks and insufficient boundary checks. Given the frequent security issues in DeFi projects, this step is particularly critical.
- Reports and Recommendations: After completing the audit, the auditing agency generates a detailed report outlining all identified issues, their potential impacts, and remediation recommendations. These suggestions often include optimizing code structure and enhancing security mechanisms.
Auditing should not be a one-time process; it must be an ongoing security strategy. As DeFi projects continuously evolve, regular audits are essential to maintain safety.
Leading Audit Agencies in the Web3 Field
With the rapid advancement of DeFi and smart contract technology, security concerns have become paramount. Many professional audit institutions have emerged, focusing on blockchain security and achieving high credibility. Here are several leading Web3 audit agencies:
Trail of Bits is one of the most well-known audit institutions in the Web3 field. Founded in 2012, it focuses on all aspects of information security, especially the audit of smart contracts and blockchain technology. Their services cover everything from cryptographic verification and static analysis to advanced security auditing. Trail of Bits has extensive experience and has participated in security reviews of many well-known DeFi projects, helping these projects effectively avoid disasters caused by code vulnerabilities.
Trail of Bits’ strength lies in its professional team and self-developed open source tools such as Slither and Manticore, which can help audit smart contracts and discover potential vulnerabilities. In addition, they have provided a large number of security reports and audit recommendations for Ethereum and other blockchain ecosystems, making great contributions to the security development of the industry.
2. Quantstamp
Quantstamp is another widely trusted blockchain security company that specializes in auditing smart contracts and blockchain applications. Founded in 2017, Quantstamp is committed to making blockchain technology more secure and has audited more than 200 projects and inspected billions of dollars in contracts. Their audit process includes automated tools combined with professional inspections, which allows them to quickly identify and fix potential vulnerabilities.
Quantstamp is known for its fast and flexible audit services and has also been involved in security audits for multiple DeFi projects such as MakerDAO, Binance, and Ethereum 2.0. Their strength lies in their ability to provide immediate security reports and repair suggestions, allowing project parties to take quick action to ensure the safety of funds.
3. Certik
Certik is a leader focused on blockchain and smart contract security, committed to using advanced technology to ensure the security of the DeFi ecosystem. Certik uses unique formal verification techniques to check the correctness of smart contracts, which means they are able to find and fix potential vulnerabilities before deployment. The agency’s audit services cover the entire life cycle security from project launch to post-operation, and have provided security support for well-known projects such as Binance, Aave and PancakeSwap.
The highlight of Certik is the Skynet monitoring system it provides, which can conduct real-time monitoring and detect abnormal activities in a timely manner, ensuring that project parties and users can respond to potential attacks and risks in a timely manner. This technology greatly improves the security of blockchain projects and provides a solid technical foundation for the development of DeFi projects.
4. OpenZeppelin
OpenZeppelin is a leader in the field of blockchain security. It not only provides audit services, but also develops open source smart contract libraries that are widely used in the blockchain ecosystem. Their contract library is used by countless projects and updated regularly to ensure that the latest security technologies can be applied by project parties. OpenZeppelin’s audit service performs security checks on every detail of the contract and provides detailed reports and remediation recommendations.
OpenZeppelin’s open source tools are also widely used, especially their Defender platform, which provides security management and continuous monitoring services for smart contracts, helping project parties better ensure the security of running contracts.
5. PeckShield
PeckShield is a company specializing in blockchain security, risk management and data analysis. Their auditing business is well-known in the global blockchain industry. PeckShield’s professional team can not only find code vulnerabilities, but also conduct comprehensive risk assessments to help project parties formulate long-term security strategies. They have participated in the security audits of multiple well-known projects, such as the review of EOS and Ethereum, and have rich practical experience in the DeFi field.
PeckShield also provides real-time risk warning services for blockchain projects, using data analysis to promptly discover potential threats in the market and helping project parties respond to possible risks in advance.
These audit institutions play a vital role in ensuring security within the Web3 field. Collaborating with them can not only secure project operations but also enhance user trust.
LayerPixel’s Commitment to Security
At LayerPixel, security is our top priority. We understand the vital importance of smart contract security for our users and have embedded this commitment into the foundation of our project. Our dedication to security is not just a promise to our users; it is a responsibility we uphold for the entire ecosystem.
1. Partnerships with Leading Security Agencies
LayerPixel partners with premier audit firms renowned for their extensive blockchain auditing experience and cutting-edge security technologies. Their expertise allows us to quickly identify potential risks and implement proactive measures to prevent incidents similar to the uniBTC breach. We look forward to announcing these partnerships soon.
2. Security-First Fee Policy
While our transaction fees on PixelSwap may be slightly higher, this reflects our unwavering commitment to protecting user assets. We invest in advanced security infrastructure and conduct regular audits to mitigate the risk of system vulnerabilities. We are actively exploring ways to optimize our fee structure, ensuring we strike a balance between security and user affordability.
3. Community Safety Mechanism
We actively encourage the developer community to engage in our security initiatives. Soon, we will launch a Community Bug Bounty Program aimed at inviting security experts and white-hat hackers to rigorously test our systems and report any vulnerabilities. We believe that community involvement will significantly strengthen LayerPixel’s security posture.
4. Transparent Reporting
To build user trust, we plan to publicly share our audit reports after each evaluation. This commitment to transparency will not only demonstrate our dedication to security but also keep users informed about the ongoing improvements we are making. We will soon release the finalized audit report from a leading auditing agency.
Moving forward, LayerPixel will continue to innovate in security technology, aspiring to be one of the most secure projects in the DeFi space and to contribute to the overall security development of the TON ecosystem.
What is LayerPixel?
LayerPixel is a DeFi solution within the TON ecosystem, providing a complete infrastructure for Telegram Mini Apps. Its core features include:
- PixelWallet: An SMC wallet with Account Abstraction (AA) features, enabling users to interact with dApps and the LayerPixel ecosystem with ease.
- PixelSwap: The first modular DEX on TON, supporting advanced trading models like weighted pools and LBP.
- Pixacle: A decentralized oracle solution delivering fast and accurate price data to dApps and smart contracts.
LayerPixel adopts a multi-layer architecture, including a funding layer, settlement layer, and execution layer, each serving distinct functions. This design enhances system flexibility and scalability, supporting third-party modules for greater customization.
LayerPixel is not just a DeFi solution; it is a cornerstone of the TON ecosystem. Its innovative architecture and core functions aim to create a flexible environment for developers to build dApps while providing users with convenient DeFi services. Future plans include introducing cross-chain solutions and expanding third-party functionalities to enrich application scenarios, further promoting the widespread adoption of DeFi.
LayerPixel’s Vision for Security
At LayerPixel, we firmly believe that security is fundamental to the ongoing development of DeFi projects and building user trust. The uniBTC vulnerability underscores the critical importance of smart contract security, with auditing being key to ensuring this security. We view auditing as a continuous process, integral to the entire project lifecycle.
By collaborating with top auditing institutions, we ensure that our contracts undergo strict security checks at every stage. Our vision extends beyond building a powerful DeFi ecosystem; we aim to create an environment where users can confidently participate. We will continue to optimize our audit processes and improve our fee structure to enhance user experience while safeguarding their assets.
LayerPixel is committed to the highest security standards, setting an example of reliability and transparency in the DeFi community. Through our steadfast approach to auditing and security, we aspire to become the most trusted DeFi project in the TON ecosystem, offering users safe, transparent, and reliable services.
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