As the crypto industry pushes deeper into mainstream finance, security experts are sounding the alarm: many firms still fall dangerously short of basic cybersecurity practices, leaving billions in digital assets exposed to credential leaks, insider abuse, and outdated code vulnerabilities.
In a hard-hitting interview with crypto.news, Hacken, a leading blockchain security and forensics firm, revealed that far too many crypto projects treat security audits as marketing badges rather than critical infrastructure safeguards.
Audits Are Not Enough: Outdated Practices Undermine Protection
“Every audit becomes outdated the moment a contract is changed,” said Dyma Budorin, CEO of Hacken.
Budorin warns that most teams rely on static audits a one-time check of their code without setting up continuous validation systems. As smart contracts evolve post-deployment, these old audits lose their effectiveness, leaving protocols exposed.
Worse still, some projects skip automated testing frameworks like symbolic execution, fuzzing, and formal verification even though these could prevent catastrophic vulnerabilities before launch.
“Audit relevance is the problem, not audit coverage. We need systems that track every change, revalidate assumptions, and trigger re-audits,” Budorin explained.
Patch Management and Upgradability Still Weak Spots
Many smart contract platforms also fail to build in clear mechanisms for patching vulnerabilities or deactivating risky legacy contracts. Hacken argues that without enforced update controls, too many protocols are “left to the mercy of hackers.”
The team is pushing for protocol-level frameworks that monitor and adapt as smart contract environments evolve something the industry currently lacks at scale.
Off-Chain Security Lapses Fuel High-Profile Hacks
It’s not just the code. Dmytro Yasmanovych, Hacken’s head of compliance, highlighted that some of the worst breaches like Bybit’s $1.5 billion loss stemmed from off-chain issues, such as misconfigured multisig wallets and weak operational security.
“Crypto firms must adopt hardware-backed multi-factor authentication, enforce strict transaction approvals, and ensure encrypted communications across sensitive workflows,” Yasmanovych stressed.
He urged the industry to fully implement the Cryptocurrency Security Standard (CCSS) a globally recognized framework designed to mitigate operational risks yet one that many firms still ignore.
The LIBRA Rug Pull: Exit Liquidity Masquerading as Innovation
Perhaps the most damning case was Hacken’s assessment of the LIBRA token. Touted as a cutting-edge liquidity solution, the project collapsed in what Hacken labeled a “textbook rug pull.” Insiders reportedly dumped over $300 million in tokens during a hype-driven price surge.
“It wasn’t innovation it was exit liquidity,” said Budorin. “The design let insiders sell into manipulated spikes. That’s how you destroy trust in the industry.”
The team argues that crypto should take cues from traditional finance, where insiders are required to disclose token allocations, vesting schedules, and major trades. Voluntary transparency, or third-party monitoring tools, could be a first step toward restoring credibility.
The Road Ahead: Oversight, Not Just Code
While full-scale regulation remains controversial in decentralized finance, Hacken believes the industry must adopt oversight mechanisms to survive. These could include public project ratings, audit version tracking, and platforms that flag suspicious token behavior before investors get burned.
“Crypto can’t become foundational infrastructure if it acts like a casino,” said Budorin. “Security has to evolve from patchwork to protocol, from slogans to systems.”
A Wake-Up Call for Web3 Builders
As crypto matures into a global financial layer, security must keep pace. Hacken’s message is clear: without real-time monitoring, proactive off-chain protections, and greater transparency, the industry risks undermining its own future. The cost of ignoring these warnings? Billions lost and trust permanently damaged.
