5 Reasons to Audit Smart Contract
Let’s start with the simple question. Is your blockchain project fully protected from potential cyber threats? Before you answer, we want to inform you that a new cyber-attack takes place approximately every 40 seconds. With that in mind are you still confident in the level of security your company has?
Of course, blockchain technology has allowed numerous companies to take their businesses to the next level in terms of financial and strategic development. Therefore, it is not surprising that the number of blockchain projects is continuing to grow rapidly. However, at the same time, an increasing number of cybercriminals are also emerging. They are constantly looking for new ways of bypassing a companies’ security, enabling them to steal important data, finances or trading information. The majority of malicious users target blockchain projects, especially ICOs, which is why it is so crucial to ensure you have the highest level of smart contract security by performing a timely smart contract audit. Still not convinced? It’s easy to believe that it won’t happen to your company but even a small mistake can cost millions.
We picked the 5 main reasons to perform a smart contract audit in order to highlight the importance of this process and show you how a company can actually benefit from performing one:
- To avoid hacking incidents. The first and main reason is to prevent any possible security breaches, prevention is always better than dealing with the consequences later. One small mistake can cause serious damage and although performing regular smart contract audits doesn’t guarantee 100% protection, it significantly reduces the risk of an attack. Take, for example, the famous DAO hack case which you may already know about. The company lost 3.6 million Ether due to a vulnerability that could have easily been prevented by performing a regular smart contract code audit. When it comes to a company’s security, taking a proactive approach is a necessity.
- To prove you’re not a scam. Reliability is what attracts clients and trust works both ways. By showing that you care about protecting your clients’ private data and finances from malicious users, a company can prove that they can be trusted. There are a lot of scams nowadays, so performing a smart contract code audit will help you both retain regular clients as well as attracting new ones. For example, owners of an ICO company, Centra Tech were arrested and charged with fraud. They lied about their products and even faked team members to make investors believe they were dealing with reputable corporations like Visa and MasterCard. Centra Tech managed to collect around $60 million from investors.
- To ensure a smart contract functions properly. It’s extremely important to check whether your smart contract works correctly. Even the smallest bug can cause dire consequences. There are no unbreachable companies and unintentional code errors can occur at any stage of a project’s development. As an example, Bithumb, a South Korean cryptocurrency exchange lost $31.5 million due to a cyber-attack. Performing a timely smart contract code audit allows you to detect any potential vulnerabilities in advance.
- To save your reputation. If your company gets hacked it could likely lose finances, data and trading secrets but what about the reputation? In some cases, reputation is the one thing that cannot be recovered. Therefore, is it worth taking the risk? A simple procedure of smart contract auditing could prevent your company from losing its reputation and the loyalty of your clients, which is sometimes even more important. In February 2018, a GitHub platform was able to defend itself from the largest ever DDoS attack. Being prepared for possible hacking incidents and taking cybersecurity seriously is the key to saving a company’s reputation in the long term.
- To protect customers. Any business only exists because of its customers so protecting their data and ensuring their safety should be a priority. Any possible breaches of confidentiality can harm a customer in many ways, especially if sensitive data is stolen. Therefore, a smart contract audit will help a company to prevent their clients from losing finances or any personal data. For example, due to a vulnerability in Equifax, the sensitive data of around half of the US population was exposed.
As Ginni Rometty, IBM’s chairman, president and CEO said: “Cybercrime is the greatest threat to every company in the world.” Since cybercrime is common reality nowadays, the task of every company is to provide the utmost cybersecurity to their customers by taking the proper measures. By performing a smart contract audit, a company will prevent possible breaches and potentially save a fortune in the long run. Blockchain technology has provided numerous opportunities for organizations due to its many obvious advantages. However, the risk of exposing private data and risking a significant amount of your finances due to cyber-attacks requires additional efforts and innovative approaches to be put in place.
Employing a trustworthy smart contract audit company to work with you can potentially save you millions of dollars as well as your reputation. Mind that smart contract audit should be performed following 5 crucial requirements.
Investing in proper cybersecurity in advance is a strategic move for a company’s development and growth. Leaving your company open with a number of vulnerabilities is like having a time bomb which can potentially explode any day. With large finances at stake, even the slightest possibility of a cyber-attack cannot be ignored.
How Hacken can help
At Hacken, we take security extremely seriously, and all the checks are performed according to the highest standards. If you have any questions about the topic or need a consultation, feel free to contact our Team!
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