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On a decentralized exchange, users custody their own funds. So if a user gets hacked, it's not on the exchange. The only exception is liquidity providers, who g
by Acrobatic_Road 5y ago
On a decentralized exchange, users custody their own funds. So if a user gets hacked, it's not on the exchange. The only exception is liquidity providers, who give money to a contract.
- igorkraw 5y agoYeah, but what if the contract implementing the decentralised exchange has a bug?
- Acrobatic_Road 5y agoWell, then any LP funds in the contract are in jeopardy, as are any transfers to the contract. That's a lot less painful than all users of the exchange getting robbed. So the theoretical "bug bounty" is way lower on a decentralized exchange. Decentralized exchanges have a smaller attack surface than centralized exchanges, and be publicly & professionally audited. That's why they don't usually get hacked.