Smart Contract Vulnerabilities Have Cost DeFi Billions — Here's Why They Persist

Smart contracts are self-executing programs deployed on blockchains like Ethereum that automate transactions across DeFi, DAOs, and supply chains without intermediaries. First theorized by cryptographer Nick Szabo in the 1990s, they became practical after Ethereum launched in 2015 with its programmable virtual machine. Their defining feature — immutable, deterministic code — also makes any embedded flaw permanent and extremely difficult to fix after deployment. Attackers have exploited these vulnerabilities to siphon billions of dollars from decentralized protocols in recent years. The irreversible nature of on-chain code means security must be built in from the start, as post-deployment corrections require complex and often contentious interventions.