Welcome to Finance Redefined, a weekly newsletter providing you with essential decentralized finance (DeFi) insights, designed to bring you the most important developments of the past week.

This week, Finance Redefine looks at the increasingly popular scalable solution based on zero-knowledge proofs. Zero-knowledge rollups (ZK-rollups) technology has gained a lot of attention over the past year due to increased usage in the Ethereum ecosystem.

Bug bounty is regarded as an important reward system for white hat hackers, aiming to clear the loopholes in the DeFi ecosystem, which often become victims of loopholes. However, recent analysis suggests that these programs have had mixed results.

Following a series of attacks on the multi-chain protocol over the past few weeks, the founders of Connext have proposed a “sovereign bridge token” standard to prevent future problems and attacks.

Algorand’s decentralized lending protocol is expected to end before the end of the year, as developers claim building a lending protocol “is no longer a viable path for the protocol.”

The top 100 DeFi tokens had another mixed week before surging late on July 13, helped by Ripple’s partial verdict in its fight with the SEC, resulting in 84 XRP (XRP) price is up by %.

Ethereum scaling protocol will drive use of zero-knowledge proofs in 2023

The Ethereum scaling protocol dominates the use of ZK-rollups, and key highlights in ZKValidator’s industry report include major releases, new research, and healthy competition.

The “State of ZK Q2” report by node infrastructure operators reflects significant events across the ZK ecosystem, notable among which is the launch of ZK-powered Layer 2, highlighting the growth in adoption of the technology compared to other market segments. Extended situation.

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Algorand’s decentralized lending protocol, Algofi, will shut down by the end of 2023

Algofi, the lending protocol built on top of the decentralized finance blockchain Algorand, is shutting down.

According to a July 11 announcement, developers “have not wavered in their faith in the strength of Algorand technology and the novel consensus algorithm,” but the Algofi platform will soon cease operations.

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Bug Bounties Help Secure Blockchain Networks, But Results Are Mixed

Bug bounties are programs offered by organizations to incentivize security researchers or ethical or white hat hackers to discover and report vulnerabilities in their software, websites or systems. Bug bounties aim to improve overall security by identifying and fixing potential vulnerabilities before malicious actors exploit them.

Organizations implementing bug bounty programs typically have guidelines and rules outlining the scope of the program, eligible targets, and the types of vulnerabilities they are interested in. Based on the severity and impact of the discovered vulnerabilities, they can also define the bounties offered for valid vulnerabilities. Wrong submissions, ranging from small amounts of money to large cash rewards.

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Arbitrum-Based Rodeo Finance Exploited Second Time, $1.5M Stolen

Rodeo Finance, an Arbitrum-based decentralized finance (DeFi) protocol, was exploited on July 11 and lost $1.53 million. The DeFi protocol was exploited for a code vulnerability in its oracle, resulting in the loss of more than 810 Ethereum (ETH). Rodeo Finance was earlier exploited on July 5 due to a vulnerability in the mintProtocolReserves function, losing approximately $89,000.

According to data shared by blockchain analytics firm PeckShield, the attackers later bridged the stolen funds from Arbitrum to Ethereum and exchanged 285 ETH for unshETH. The exploiter then deposits ETH into the Eth2 stake. Finally, the stolen ETH was routed using the popular mixing service Tornado Cash, which is often used by exploiters as an exit route to hide transaction footprints.

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After the multi-chain incident, the founder of Connext proposed the “sovereign bridging token” standard

The July 7 Ethereum Improvement Proposal (EIP) aims to standardize the way tokens are bridged between networks. The “Sovereign Bridge Token” standard, or EIP-7281, allows token issuers to create canonical bridges across multiple networks.

The proposal was co-authored by Connext bridging protocol founder Arjun Bhuptani. In a July 7 social media post, Bhuptani claimed the protocol would help prevent issues like the July 6 multichain incident, which some experts described as a hack.

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DeFi Market Overview

After a three-week bear market, DeFi’s total market capitalization has seen a bullish surge. Data from Cointelegraph Markets Pro and TradingView shows that the top 100 DeFi market capitalization tokens are bullish this week, with most tokens trading in the green. The total value locked in DeFi protocols is still below $50 billion.

Thanks for reading our roundup of the week’s most impactful DeFi developments. Join us next Friday for more stories, insights and education about this dynamically developing field.

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