How Sybil Attackers Are Ruining the Golden Age of Airdrops – DL News

A version of this article appeared in our Decentralized newsletter of June 25. Register here.

general manager, Tim here.

Here’s what caught my attention about DeFi recently:

• How Sybil Attackers Are Ruining the Golden Age of Airdrops.
• The latest on CertiK’s $3 million Kraken hack.
• DL News discovers an agreement between Lens Protocol and ZKsync.

Airdrop attackers

In recent months, the number of crypto airdrops has exploded.

So why do many people say that the golden age is over?

In short: Sybil Attackers.

These buccaneer DeFi players create multiple wallet addresses to spoof airdrops by pretending to be running legitimate activity.

So-called airdrop farming allows them to potentially rake in millions.

Join the community to receive our latest stories and updates

The problem with Sybil attackers is that they cost crypto projects millions.

Some airdrops targeted by industrial-scale Sybil attackers include:

Increasing the number of Sybils could force airdrops to shift to a distribution method that rewards smaller players with significantly fewer chips.

One idea is a linear distribution.

This means that the more crypto a user stakes to provide liquidity on a blockchain or DeFi protocol, the larger their airdrop will be.

While a linear distribution may be fairer, it turns airdrops into a whale game – skewing them to benefit large crypto holders at the expense of smaller ones.

Despite problems with Sybil attackers, the number of airdrops is not slowing down.

Here are some confirmed airdrops that could happen soon:

And a few who hinted at airdrops launch points:

The CertiK Kraken spat

The multi-day hack of crypto exchange Kraken by crypto auditor CertiK has left DeFi experts and security researchers stunned.

CertiK has since income the $3 million he took out of Kraken using what is called a comeback attack. But many questions remain.

Onchain records show that a hacker used the same bug to attempt to exploit other exchanges as early as May 17.

These exchanges include:

This is almost three weeks before CertiK announced that it had discovered the bug in Kraken’s systems.

CertiK declined to comment on the matter.

Certainly, the records do not prove that CertiK was behind the previous attempts.

A security researcher who wished to remain anonymous said DL News that another actor could have used the same name that CertiK used for its exploit code.

Lens ZKsync agreement

Zero-knowledge protocol ZKsync paid Lens Protocol tens of millions of dollars in tokens to use its technology, sources said. DL News.

The exact number of tokens Lens received in the transaction is unclear.

Those who were competing with ZKsync to attract Lens to their blockchains withdrew from the bidding war once Lens said they had been offered around 0.5% of the total supply of ZKsync tokens.

This represents 105,000,000 ZK tokens, with a market value of $17 million.

The deal may not be as good for Lens as it initially seemed.

When tokens are sold in transactions, they are typically locked for a period before the recipients can sell them.

Since its launch on June 17 at around $0.28 per token, the ZK token has sunk. It is down 37% and is now trading at around $0.16.

It is unclear how long, if at all, Lens’ ZK tokens are locked.

Data of the week

Ethereum gas fees briefly dropped to around 1.7 gwei over the weekend for the first time since 2020.

Decreasing demand and shifting activity to Ethereum Layer 2 are contributing factors to low gas fees.

Ethereum gas fees fell to a four-year low early Sunday morning. (Etherscan)

This week in DeFi governance

VOTE: Aave DAO takes first step in integrating Aave Labs as a service provider

VOTE: Real DAO split over Wallfacer Labs funding request

VOTE: Composite votes to renew OpenZeppelin security partnership

Article of the week

BitMEX co-founder Arthur Hayes is back with another blog post on how the macroeconomic situation between the United States and Japan could benefit crypto.

What we watch

Crypto-based prediction market Polymarket just hit an all-time high in terms of open interest – the total value of bets placed on the markets.

Do you have a tip on DeFi? Contact us at tim@dlnews.com.

Source