In recent years, the usage of DeFi-based wallets has increased to ease financial services through cryptocurrency. However, bad malicious individuals have leveraged these wallets to introduce suspicious codes to rip off crypto holders.
A Reddit user has nevertheless suggested that every crypto trader and investor should revoke smart contract permissions of all approved third-party protocols.
Also read, A Quick Look at Smart Contracts
According to the user, after observing approval of smart contracts for the past 2 years on his wallet, some of the protocols he allowed either intentionally or otherwise, allowed him to withdraw an unlimited amount of funds, noting that the action is in contrast to what crypto assets in a DeFi wallet should stand for.
“You should at least check your approvals too and possibly revoke them. The reason for that is that one might have accidentally approved a malicious contract that is only waiting for a certain amount of funds to steal, or some hacker might find a bug in a good-behaving contract that can be exploited. I am repeating myself here,” a Reddit user explained.
Also read, What is Smart Contract Audit?
Malicious individuals through these suspicious smart contracts find it easy to access funds. They send counterfeit airdrop tokens to users’ crypto wallets.
They describe the token as “cash out the fake token”, making unsuspecting holders fall for the trap, thus making them approve malicious third-party code.
Don’t miss important articles during the week. Subscribe to blockbuild weekly digest for updates.