One would not be entirely evading the truth if one position that hacks and scams are one of the bedrock of the decentralized finance sector. Despite the sector growth over the years due to its potential and the activities carried out in it, this menace has seen most people step away from the budding sector.

In a recent tweet that PancakeSwap shared on their Twitter handle, the decentralized finance protocol has seen malicious actors enter their platform illegally. Before this announcement, Cream Finance mentioned that a malicious entity has been able to gain access and compromise its DNS. Confirming everyone’s suspicions in the sector, PancakeSwap mentioned that the attackers were able to access their protocol illegally through the same method.

PancskeSwap says its smart contracts are still safe

In layman’s terms, a DNS attack is a hack attack that happens when malicious actors gain credentials of an account and reroute the activities carried out on the site. In this case, the hacker could get the entrance codes of the decentralized protocols and are rerouting their traffic into another platform.

Centralized crypto exchanges make use of central authority for their users to trade. In contrast, a DeFi exchange uses different codes known as smart contracts that allow users to trade amongst themselves. DeFi protocols have always branded themselves as non-custodial, meaning that they do not hold assets traded by people on their protocol.

This means that only the front end of PancakeSwap has suffered a breach while the smart contracts are still doing well. In their post on Twitter, PancakeSwap warned traders to desist from the platform for now until they have wrestled back control from the malicious actors. They also asked the crypto community on Twitter to help them put it on other platforms so people would not fall victim.

Hack attacks in the DeFi sector are increasing at an alarming rate

Investors must be well aware now that their investments in the decentralized finance space are not that safe due to the alarming attack rate on protocols in the sector. A recent survey showed that almost 50% of the attacks carried out in the crypto space last year involved the decentralized finance sector.

With 2021 just beginning, the malicious actors are not slowing down as we have witnessed a massive amount of hack since the start of the year. Last week was Dodo’s turn to get hack as the hackers were able to cart away close to $4 million from the protocol. PancskeSwap has also told his users that their funds are safe with them.

However, the companies have told users who have entered their seed phrase or private key into the already breached website that their funds are at risk, so they should do well to withdraw them. PancskeSwap has so pointed that they are on the verge of regaining their DNS control but are trying to look out for newbie traders in the protocol. Lastly, they have urged all their users not to go to the site at present.