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Blockchain, Crypto, DeFi, Web3 Security Monitoring and Detection

Real-time comprehensive threat detection for smart contracts, DeFi, blockchain, web3 solutions

Blockchain, Crypto, DeFi, Web3 Security Monitoring and Detection

In the rapidly evolving landscape of Web3, blockchain, crypto, and DeFi, maintaining a robust security posture requires constant vigilance. Security monitoring and detection for crypto and blockchain present unique challenges that stem from the inherent characteristics of these technologies. Blockchain’s decentralized nature means that there is no single point of control or oversight, making traditional monitoring techniques less effective. The distributed ledger is often immutable, meaning that once a transaction is recorded, it cannot be altered or deleted. While this provides a high level of integrity, it also means that fraudulent or malicious transactions, once committed, cannot be reversed. Detecting such activities before they are recorded on the blockchain requires specialized tools and a deep understanding of the unique patterns and behaviors associated with crypto transactions.

The rapidly evolving landscape of crypto and blockchain technologies further complicates monitoring and detection. New protocols, smart contract functionalities, and decentralized applications are continually being developed, each with its own security considerations. Staying ahead of potential vulnerabilities and threats in this dynamic environment requires continuous monitoring, specialized expertise, and a flexible approach that can adapt to the ever-changing landscape of crypto and blockchain security.

Crypto Threat Intelligence

Traditional security operations center (SOC) expertise, while essential, is not sufficient. Cryptosec team members have built and operated Security Operations Centers for some of the largest organizations in the world. We combine the proven methodologies and practices of traditional SOC operations with a deep understanding of Web3, blockchain, crypto, and DeFi technologies. This unique blend of expertise enables us to provide a service that is both comprehensive and tailored to the specific needs of decentralized systems. Even more, our approach focuses on creating and operating fusion security centers that combine enterprise IT security monitoring + blockchain/crypto-specific security monitoring + financial crime monitoring.

We can be engaged to design and implement your in-house blockchain/crypto security monitoring and detection capabilities, or we can operate the service for you as a managed service. 

In both cases, the objective is to achieve constant monitoring of your systems and networks, identification and triage of potential threats, and provision of timely alerts. We leverage advanced tools and technologies to provide real-time visibility.

Sample Monitoring Events

Detect threats and anomalies in smart contracts, DeFi, NFT, governance, bridges and other web3 systems in real-time – both, through heuristic anomaly detection and rules-based detection. Some of the decentralized solutions-specific monitoring events of interest might include (not an exhaustive list):

Sudden Drops in Liquidity

Monitoring for abrupt decreases in liquidity can help identify potential market manipulation or signs of a looming crisis in a DeFi protocol.

Unauthorized Contract Ownership Changes

Tracking contract ownership changes can alert to unauthorized or malicious attempts to seize control of a contract, a critical step in preventing potential fraud or theft.

Increase in Transaction Failures

An unusual spike in transaction failures could indicate a network issue, a smart contract bug, or a potential attack on the network.

Transactions with an Unusually High Gas Price Paid

Monitoring for transactions with exceptionally high gas prices can help identify priority transactions, potential front-running attempts, or other unusual activities.

Transactions from a Banned Address

Tracking transactions from banned or blacklisted addresses can help in enforcing network rules and maintaining the integrity of the platform.

The Upgrade of a Proxy Contract

Monitoring for proxy contract upgrades can help ensure that changes are authorized and implemented correctly, maintaining the security and functionality of the contract.

Ownership Transfers and Role Changes

Keeping track of ownership transfers and role changes can help maintain accountability and ensure that only authorized individuals have control over contracts and assets.

Administrative Events Not Happening as Expected

Administrative Events Not Happening as Expected or When Scheduled. Monitoring for deviations from expected administrative events can help identify potential security issues or operational inefficiencies.

Changes to the Number of Administrators or Approvals

Changes to the Number of Administrators or Approvals on an M-of-N Wallet. Tracking changes in the number of administrators or required approvals on a multi-signature wallet can help maintain security and prevent unauthorized access.

Sudden Token Price Changes

Monitoring for sudden changes in token prices can help identify potential market manipulation or other unusual market activities.

High Number of Failed Transactions for a Specific Contract

A high number of failed transactions for a specific contract could indicate a bug in the contract, a potential attack, or other issues that need to be addressed.

Unusual Wallet Activity

Sudden spikes in activity from a particular wallet, such as a large number of transactions in a short period of time, could indicate suspicious behavior.

Smart Contract Interactions

Any interactions with smart contracts that deviate from the norm, such as calls to functions that are rarely used, could be a sign of an attempted exploit.

Changes in Network Congestion

An unexpected increase in network congestion could indicate a potential Distributed Denial of Service (DDoS) attack or other malicious activity.

Abnormal Mining Activity

Sudden changes in mining activity, such as a significant increase in the hash rate, could suggest an attempt at a 51% attack.

Unexpected Protocol Changes

Any unexpected changes to the protocol, such as a sudden hard fork, should be closely monitored.

Large Transactions

Transactions that move a large amount of crypto, especially if they are not associated with known wallets or exchanges, could indicate potential market manipulation or money laundering activity.

Anomalies in Gas Usage

Unusual patterns in gas usage, such as a sudden increase in the average gas price of transactions, could suggest an attempt to manipulate the network.

Changes in Node Distribution

A significant change in the distribution of nodes could indicate a potential Sybil attack.

Large Withdrawals or Deposits

Sudden large withdrawals or deposits could indicate potential market manipulation, money laundering, or preparation for a major transaction.

Changes in Smart Contract State

Any unexpected changes in the state of a smart contract could indicate a bug or an exploit attempt.

Unusual Trading Patterns

Unusual trading patterns, such as a sudden increase in the volume of trades, could indicate potential market manipulation or insider trading.

Changes in Consensus Participation

In proof-of-stake and similar consensus mechanisms, a sudden change in the participation of validators could indicate a potential attack or collusion among validators.

Changes in Delegations

In delegated proof-of-stake and similar consensus mechanisms, sudden changes in delegations could indicate potential manipulation or a shift in network governance.

Unusual Staking or Unstaking Events

Sudden large staking or unstaking events could indicate potential manipulation or a change in confidence in the network.

Changes in Governance Proposals or Voting

In networks with on-chain governance, sudden changes in proposal submissions or voting patterns could indicate potential manipulation or a shift in network governance.

Changes in Oracles or Data Providers

In networks that rely on oracles or external data providers, changes in these entities or the data they provide could indicate potential manipulation or reliability issues.

Smart Contract Audit
Security Monitoring and Detection

Why Choose Cryptosec?

Effective security monitoring and detection require a partner with a unique blend of traditional SOC expertise and deep understanding of decentralized technologies. Here’s why Cryptosec is the right choice for your security monitoring and detection needs:

Proven SOC Expertise

Our team members have built and operated Security Operations Centers (SOCs) for some of the largest global companies. They bring a wealth of experience and a proven track record in managing complex security environments and responding effectively to threats.

Deep Blockchain and Crypto Knowledge

At Cryptosec, we specialize in blockchain, crypto, Web3, and DeFi. Our team has a deep understanding of the unique security challenges and threats in this space, enabling us to provide relevant, actionable security monitoring and detection. We supplement Cryptosec expertise with hands-on incident response experience from our specialist incident response and investigation business – Crypto Investigators. 

Comprehensive Monitoring

We monitor a wide range of events and indicators of compromise that are specific to blockchain and crypto. This comprehensive approach helps us detect potential threats early and provide timely alerts.

Actionable Intelligence

Our security monitoring and detection services provide actionable intelligence that helps you respond effectively to threats. We provide clear, concise reports that help you understand the threats you face and what you can do to mitigate them.

Commitment to Excellence

We are committed to providing the highest quality services. From our rigorous monitoring process to our detailed reports, we strive for excellence in everything we do.

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