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A group of Ethereum community members has proposed a new standard to improve the security of decentralized finance (DeFi) protocols.
Dubbed ERC (Ethereum Request for Comments) 7265, the proposed standard would enable a "circuit breaker," allowing DeFi protocols to easily add a back-stop in their smart contracts that stops tokens before they leave the contracts in the event of a hack, according to one of the standard's builders.
"ERC 7265 allows teams to create a circuit breaker protecting their protocol, with highly customized rate limit parameters per asset," Meir Bank of Fluid Protocol. "When a hack happens, the attacker will no longer be able to drain an entire contract in seconds. The majority of funds can be recovered."
The proposed ERC 7265 standard comes amid rising DeFi hacks. Nearly $3 billion worth of funds have been stolen by attackers from DeFi protocols to date.
Given the ERC 7265 standard is a proposed standard, it remains to be seen whether the core Ethereum team accepts and implements it as the final standard. ERCs are proposed standards that define how specific features or functionalities should be implemented on the Ethereum network, while Ethereum Improvement Proposals or EIPs are submitted changes and improvements to the Ethereum protocol itself. ERCs and EIPs get finalized after they are passed by the broader Ethereum community and implemented by core developers.
TokenInsight's Tokenwiki: What is EIP
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