Day by day, security is becoming one of the leading topics in crypto. Here are some numbers – just in the first three months of 2022, hacks resulted in a loss of $1.6 billion.
And though the pace of project launches is high, security of funds is yet to go hand in hand with it. One of the projects in the crypto space working toward providing token creators with protective measures is Lossless, in which they already presented the industry with four working products.
How assets can be protected
What are the most common issues in the crypto field which result in hacks? Smart contract vulnerabilities or private key theft.
Usually, it can be noticed that a project lacks audits to evaluate its smart contract quality, or a strong development team is missing so that the code would be prepared thoroughly.
Vygandas Masilionis, CEO of Lossless, shared that “because of this, we decided to create Lossless and extend a hand to token owners and project teams which are in a need of security solutions but are not always able to ensure them on their own or find the measures in the industry.”
So far, Lossless has created and launched four security tools live: the Lossless protocol, Vault Protection, Token Minter, and the most recent one – Token Relaunch Toolkit.
One more product is coming soon, which the team calls the Security Oracle. A quick intro to each one and how they can help crypto projects protect their funds.
The Lossless Protocol
It’s the industry’s first framework for active exploit mitigation. The Lossless platform facilitates manual and automatic community-driven monitoring of suspicious on-chain activity.
Malicious token transactions are frozen after being reported and are subject to further investigation.
Lossless code detects fraud, freezes, and returns stolen funds. Token creators insert Lossless Protocol into their token’s smart contracts to mitigate the losses suffered from exploits & hacks.
There are already a number of successful cases when tokens were returned for cryptocurrencies belonging to AAG Ventures, gotEM, and Revolve Games. The process looks like this:
- Urgent freezing — Lossless Smart Contracts allow hack-spotting bots to detect and freeze fraudulent transactions, securing rewards for the bot’s creator.
- Fraud analysis — The Decision-Making Body overviews frozen transactions, validates fraud and makes a decision to freeze the receiving address permanently.
- Returning stolen funds — The Decision-Making Body enacts a proposal for transaction reversal, and the code reverts stolen funds back to the owner’s address.
Check out this video to learn more:
Vault protection
This is an advanced security tool for project owners. Vault Protection provides an additional layer of protection to treasury wallets and liquidity pools through whitelisting and withdrawal limiting strategies.
There are two types of protective measures project teams can apply – wallet whitelisting and withdrawal limiting.
Whitelisting will allow project owners to mark certain addresses as beneficiaries, while every other address would be denied any form of interaction by default.
Withdrawal limiting, on the other hand, allows token owners to set transaction limits for their project wallets. As simple as this solution sounds, it adds second-factor protection if anyone wants to drain a protected wallet quickly.
Token minter
The simplest tool of all four – Token Minter – is a Lossless-wrapped ERC-20 token generator. Project owners can easily mint their own Lossless-protected tokens on Ethereum, BNB Chain, Polygon, Avalanche, Fantom, and Harmony — the six EVM-based chains the Lossless team currently supports.
No development experience is required to use this product, and it’s also free of charge. Here’s an explainer of how both the Token Minter and Vault Protection work:
Token relaunch toolkit
This product is aimed at tokens that are already established in the market but would like an easier relaunch process. It will allow them to apply the Lossless protocol to their token’s smart contract for higher security standards and distribute the newly prepared tokens to their rightful owners.
The Token Relaunch Toolkit works not only with LERC-20 but is also known as Lossless-protected tokens, but it can also relaunch any token in the market. All the project team has to do is reach out to [email protected] in order to be able to use the product.
Here’s a quick step-by-step guide on how the product works:
Why is security a necessity in crypto
In 2020 the hacks made the crypto industry lose $3.8 billion. In 2021 that number grew to $10 billion. And this year, as already established, the first quarter resulted in a loss of $1.6 billion.
It is obvious that while the number of hacks and the damage they do is steadily increasing, security is not yet in the shape it should and could be in so that crypto projects would have the means to protect their and their user assets.
As the CEO of Lossless, Vygandas, puts it: “We’ve made it our mission to provide crypto protection tools to projects in web3. Hacks and exploits are one of the biggest issues in the industry, keeping it away from a faster adoption pace. Our team’s goal is to be one of the industry’s leaders for security in the near future, and that’s where we are going while continuing to build even in market environments such as the current one.”
Keep up with Lossless and its product developments via the channels below.
Whitepaper | Website | Twitter | Telegram | Discord
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