Mitchell Amador, CEO of Immunefi, argues that the best defense against hacks in the crypto space lies in effective incentives rather than just code. Bug bounties have saved billions by encouraging responsible disclosures, but current market trends are jeopardizing this balance. The scaling bug bounty standard suggests that rewards should increase with the risk involved; for instance, a vulnerability threatening $10 million should offer a bounty of up to $1 million. However, some platforms are capping bounties at low amounts, which can lead to catastrophic hacks, as seen with Cork Protocol's $12 million breach. When bounties are misaligned with the potential damage, researchers are discouraged from reporting vulnerabilities. The crypto industry must recognize that bug bounties are not mere expenses but essential insurance policies. To maintain trust and security, bounty rewards must reflect actual risks, and researchers should be treated fairly. A robust bug bounty system is crucial for the growth and confidence in the decentralized economy. Read more AI-generated news on: https://app.chaingpt.org/news