Framework Ventures led a Series A round to raise $24 million for Immunefi, a bug bounty security platform. Immunefi is a crypto-focused bug bounty program. The round also featured other backers such as Electric Capital, Polygon Ventures and Samsung Next.
Immunefi is a security company that provides Web3 projects with bug bounty and security services. According to Thursday’s statement, Immunefi has saved more than $25 billion in user funds since its inception in 2020. Immunefi claims to have paid $60 million in total bounties and has supported over 300 projects, including Chainlink, Wormhole and MakerDAO.
Tech firms continue to hire security firms to find exploits
Bug bounties have become a lucrative revenue stream for security researchers and a way for tech companies to find weaknesses in their products. Google (GOOG), stated that it had paid more than $21 million in bug bounty payments under its vulnerability reward program, and $6.5 million in 2019. Hackers from many countries made over $40 million by identifying system weaknesses for different organizations in 2020.
As crypto has grown, bug bounty rewards are slowly increasing. Crypto exchange Coinbase Global (COIN), paid $30,000 bounty in 2019 for identifying a critical flaw in its systems.
Bug bounties are also popular because decentralized finance ( DeFi), platforms such as Balancer Labs, have become more vulnerable to theft and hacking. DeFi is a financial activity that takes place directly on the blockchain, without any third-party involvement.
A report from crypto sleuth CipherTrace shows that half of all targets entities for crypto-related hackers in the second half 2020 were DeFi platforms. They accounted for 14% of total volume (amounting at $47.7 millions).
DeFi’s insurance brokerage ArmorFi paid $1.5 million in 2021 to a white-hat hacker for discovering a “critical flaw” that could have led to the loss of all underwriting funds.
Mitchell Amador, Immunefi CEO, stated in the statement that web3 has become the most adversarial space for software development in the world because of its open code and directly monetizable profits.
Amador stated that Immunefi had already saved billions of user funds by shifting incentives to whitehats. He added that the raise will be used to increase the size of his team in order to meet the massive demand.