The crypto lending market contracted by 16.78% in Q2 before rebounding, with total value locked up more than 55% from the end of Q2, according to DeFiLlama. Following the lessons learned from the 2022 collapses of Celsius, Voyager and BlockFi, protocols like Aave and Spark now adopt a broader approach to security, encompassing not only smart contracts but also bridges, verifier networks and collateral quality. Security experts emphasize the importance of containing potential losses and maintaining strict standards: Ledn notably keeps client Bitcoin in segregated custody rather than lending it out to generate yield. AI is also being introduced in security audits, with Aave’s AI-assisted testing identifying 20 valid vulnerabilities out of 71 findings, while generating approximately 70% false positives.
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