DeFi Security Basics

DeFi Security Basics

How to stay safe while using decentralized finance (DeFi) platforms#

Decentralized Finance (DeFi) lets you trade, earn, and invest directly from your wallet without middlemen. But it also comes with unique risks, and mistakes can’t be reversed. Here’s how to protect yourself.

1. Use a Self-Custody Wallet#

• Examples: MetaMask, Rabby, Trust Wallet, Ledger (hardware)
• Never share your private key or seed phrase.
• Tip: Consider a hardware wallet if your funds exceed $500 or if you plan to use DeFi regularly.

2. Interact only with trusted platforms#

• Bookmark official sites (e.g. Uniswap, Aave, Lido)
• Always double-check URLs—phishing sites can look identical.
• Use trusted aggregators (e.g. DeFiLlama, 1inch) to find platforms and opportunities.

3. Watch out for smart contract risks#

• Even audited protocols can be hacked.
• Don’t invest amounts you can’t afford to lose.
• Check how much value is locked (TVL) in a platform as a basic health indicator.

4. Manage approvals & permissions#

• Regularly review and revoke token approvals at Revoke.cash
• Use tools like Wallet Guard, Pocket Universe for real-time transaction warnings.

5. Protect your device & browser#

• Use a separate browser profile or dedicated wallet for DeFi.
• Keep your device updated.
• Install browser security extensions (e.g. Wallet Guard, Scam Sniffer).

Quick checklist for DeFi safety:#

✔ Use self-custody wallet ✔ Interact only with verified dApps ✔ Limit exposure to unaudited contracts ✔ Regularly revoke approvals ✔ Stay alert for scams & phishing