Hats Finance joins the Cointelegraph Accelerator
Cointelegraph has announced that it has joined the Cointelegraph Accelerator program, a community-driven platform for cap finance that enables permissionless on-chain audit competitions and bug bounties.
Smart contracts, tiny programs that automate and enforce agreements on-chain, are the backbone of decentralized finance (DeFi). That's why it's important to eliminate any vulnerability through regular auditing to prevent attacks and ensure the seamless operation of related decentralized applications (DApp) and Web3 in general.
However, reports show that by the first quarter of 2024, only 44 percent of Web3 projects had performed a smart contract audit. Avoiding audits can lead to significant security risks, as most hacked projects have no audits. And with smart contracts becoming more complex due to new use cases like real-world assets (RWAs) and modular wallets, the need for effective auditing is greater than ever.
Decentralized audit of decentralized projects
Traditional audits fail to meet the needs of the high-speed and heterogeneous Web3 environment and can be frustrating for projects. They include a limited number of auditors or a group, which increases the risk of overlooking the vulnerability. The process often takes weeks or months and the launch of important updates or features may be delayed as a result.
An average audit costs between $5,000 and $15,000, with more complex and high-profile projects easily running into a six-figure audit bill. Moreover, payments are required even if no vulnerabilities are found. The advent of smart contract auditing could change this.
Hat Finance is a decentralized Web3 security protocol that aims to improve Web3 security through consistent and innovative audits, a results-oriented model, and community engagement. By identifying and targeting issues related to traditional auditing, the platform provides a decentralized auditing competition that enhances Web3 security for all participants.
Projects looking to ensure the integrity of their codebase can use HAT funding to launch an automated and automated audit contest. You can set up the competition without pre-planning or legal work and define the scope, rules and possible prizes for the auditors. Security researchers are called upon to analyze the entered codes with due diligence.
A rapid configuration process and the involvement of multiple auditors significantly reduces the time from vulnerability detection to remediation compared to traditional methods. As for security researchers, hats provide an environment where they can openly compete for big prizes while contributing to the security of customer projects. A successful presentation puts auditors on the platform leaderboard and helps build their reputation in the Web3 space.
Hat Finance stands out as the only audit platform in the market that employs a pay-for-performance model. A 20% fee payment is made only if the audit provides a value and identifies a vulnerability. Such a model prevents the wastage of resources and encourages the auditing of projects by encouraging security researchers and in turn ensuring high quality assurance.
Dashboard for security researchers. Source: Hat Finance
Continuous and independent security
The platform also offers a bug bounty program. After documenting and granting access to the codebase, disclosing previously identified vulnerabilities, establishing communication channels, and creating a vault, projects are ready to start their own bug bounty program. The first entry for each bug—except for central issues or those requiring released keys—will be rewarded with related projects.
Hat Finance has secured nearly $4 million in seed funding, which will be used to prepare for its next round. The forum, home to 500 active security researchers, is currently hosting four tournaments per month and aims for eight monthly tournaments before the third quarter.
By effectively integrating the community into the audit process and reducing barriers to entry such as cost and access to qualified auditors, HAT Finance works to ensure sustainable and autonomous security for Web3 projects.
