Enhancing DeFi security through curators — Interview with Hats Finance

Decentralized security (DeSec) is an emerging paradigm that changes the way people protect digital assets. Inspired by decentralized finance (DeFi) principles, DeSec reimagines traditional security by shifting control from a centralized authority to a community-driven, transparent and resilient framework. Unlike conventional models, DeSec distributes security responsibility across developers, users and researchers, empowering everyone to contribute to a shared security system.

Hats Finance is a DeSec platform that offers the community a wide range of ways to engage in safeguarding DeFi protocols. From bug bounties to decentralized vaults, Hats Finance — a Cointelegraph Accelerator participant — provides tools for proactive, transparent and distributed security management.

In this interview, Ofir Perez, head of growth at Hats Finance, discusses how the platform leverages DeSec to enhance the security of DeFi ecosystems, sheds light on the Curator Program and the role of curators in growing the ecosystem and contributing to the security of decentralized platforms.

Cointelegraph: How does Hats Finance leverage DeSec to enhance security within the DeFi ecosystem?

Ofir Perez: Hats Finance taps into the principles of DeSec by offering community-driven security mechanisms, such as our bug bounties and audit competitions. Anyone can contribute to enhancing security by identifying and reporting vulnerabilities. Moreover, funds are stored in decentralized vaults, ensuring robust security measures and minimizing single points of failure.

Utilizing onchain and decentralized application (DApp) platforms ensures transparency in operations and accountability in handling security matters. Hats Finance’s governance is decentralized through a decentralized autonomous organization (DAO). This allows tokenholders to participate in decision-making processes, ensuring a democratic approach to managing the platform.

In summary, Hats Finance allows DeFi protocols to manage their own security processes while incentivizing high-quality contributions from the broader security community. This approach ensures that vulnerabilities are found and resolved faster, without the limitations of traditional, centralized auditing methods.

CT: What unique advantages do community-driven security initiatives offer over more conventional security approaches?

OP: Community-driven security fosters broader participation, allowing diverse perspectives and expertise to contribute to identifying and fixing vulnerabilities. Unlike conventional audits, which are often limited to a small group of experts, community-led efforts scale across a wider network in the community, making it more likely that even more complex vulnerabilities will be detected. Additionally, aligning incentives with rewards ensures that participants are motivated to deliver quality results, leading to more thorough and continuous security coverage.

CT: What is the Hats Finance Curator Program? How does it work, and what is your motivation for launching it?

OP: The Hats Finance Curator Program is another way of aligning incentives between different parts to enhance ecosystem security. It is designed to incentivize individuals and organizations to bring new projects to the Hats ecosystem. Curators act as growth ambassadors, introducing projects for audit competitions and helping guide them through the security process. Our motivation is to scale decentralized security by empowering a network of curators who help grow and support the Hats platform. It aligns with our vision of decentralizing security efforts while offering curators rewards for their contributions.

CT: Could you elaborate on the role of curators in this program?

OP: Curators are responsible for identifying and onboarding new projects for Hats Finance’s audit competitions. Depending on their tier (there are three, namely Growth Seeker, Growth Genius and Growth Wizard), they help manage the competition process, from initial contact with the project to ensuring funds are deposited into decentralized vaults. Curators also promote competitions and resolve disputes if necessary. Their role is essential in bridging the gap between DeFi projects and the security solutions Hats offers, making them key facilitators in enhancing decentralized security.

CT: What are the differences between each tier?

OP: Growth Seekers identify potential clients and facilitate the first meeting between the project and the Hats Finance team. Growth Genius manages the audit competition journey from start to finish, ensuring seamless execution. Growth Wizard takes full ownership of the competition process, from promotion to dispute resolution, ensuring optimal outcomes for all parties involved.

CT: What is the Curator Program’s rewards structure, and how are curators incentivized to engage in this program?

OP: Curators are incentivized through a tiered reward structure. For every successful audit competition they manage, curators receive up to 50% of the fees paid by the protocol. The more responsibilities a curator takes on, the higher their reward. This ensures that curators are motivated to both onboard new projects and see them through the competition process.

CT: How does Hats Finance plan to expand and innovate within the DeSec space in the coming years?

OP: Hats Finance is committed to continuously developing its product and fully decentralizing key functions, including growth, dispute resolution, reviews and vulnerability remediation. Designed to streamline the entire audit process within just a few transactions, the Hats platform aims to deliver a competitive, professional and high-quality security and audit service that meets the evolving needs of decentralized security.