The Impending Crisis: DeFi's Massive Exodus Threatens its Survival

Decentralized finance (DeFi) platforms are facing existential challenges as they grapple with frequent hacks and security breaches, eroding investor confidence. In the past month alone, Curve Finance, Exactly, Saddle Finance, Spirit Swap, and Hundred Finance have all experienced significant security breaches or closed down. Between January and July 2022, there were 132 DeFi hacks resulting in losses worth $1.8 billion. Additionally, the declining market share of DeFi, with the total value locked (TVL) dropping to $37 billion, has been attributed to lower cryptocurrency prices and rising interest rates on low-risk assets. Regulatory scrutiny is also increasing, with lawmakers calling for more oversight of the sector. Despite these challenges, some industry experts believe that responsibly designed protocols can help mitigate risks and ensure the future viability of DeFi.