Recent research on bridge volumes in the crypto industry has highlighted a potential connection between increased activity and hacking incidents. Expert ZachXBT has raised concerns regarding how hackers may utilize bridges for laundering funds.
Bridge Volumes and Hackers
ZachXBT noted that bridging volumes may not be entirely organic, and they could be driven by hackers attempting to launder funds. He commented on a recent X post which claims that the LiFi protocol is seeing record volumes.
Challenges of LiFi Protocol
The LiFi protocol faces similar issues as other Web3 protocols, particularly the lack of tools to combat bad actors due to its permissionless nature. There have been instances where the project, like THORChain, refused to cooperate in freezing assets in response to suspicious activity.
Overall Increase in Bridge Volumes
ZachXBT's investigations coincide with a general growth in bridge volumes over the past month. Bridges remain crucial for the ecosystem, primarily for moving funds between Ethereum and L2 chains. Arbitrum has shown the most significant activity, although not all volumes stem from organic demand.
The rising bridge volumes in the crypto space raise alarms among experts. The continued increase in activity may involve hidden risks related to hacking and money laundering.
