🏴 How I Stay Safe in DeFi

Good opsec can't protect you from every attack vector in crypto, but our resident DeFi explorer has some tips to help you keep your funds safe.

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🔒 FREE PREVIEW: Upgrade to unlock full access. Join Bankless Premium. How I Stay Safe in DeFi Published on Apr 28, 2026 View in Browser gm Bankless Nation, Good opsec can't protect you from every attack vector in crypto, but our resident DeFi explorer has some tips to help you keep your funds safe. Today's Issue ⬇️ ☀️ Need to Know: CFTC AI Cops? The CFTC will leverage AI to police crypto markets. 🗣️ Analysis: Staying Safe in DeFi Tips for exploring the frontier of DeFi, safely. Sponsor: MetaMask - Spend crypto anywhere online and AFK with MetaMask Card. Learn about MetaMask Card .  .  . NEED TO KNOW CFTC AI Cops? 🚔 CFTC Will Use Artificial Intelligence to Police Crypto. Chair Selig says automated oversight will enable the agency to keep pace with the crypto industry, even as staffing levels decline. 🤑 Ondo Finance Enables Shareholder Voting for Tokenized Stocks. A new partnership with proxy services firm Broadridge will enable Ondo tokenized equity holders to participate in corporate governance. 🔋 Galaxy Digital Delivers First AI Data Center at 'Helios' Campus. The converted BTC mining center is poised to pay out $1B+ in revenue from a long-term AI compute lease. 📸 Daily Market Snapshot: Stock indices dipped as oil futures skyrocketed back above $100. Oracle dropped 4% as fear compounded that OpenAI's slowing growth won't leave them in a position to keep making big data center commitments. Prices as of 5pm ET 24hr 7d Crypto $2.55T ↘ 0.6% ↗ 0.8% BTC $76,452 ↘ 0.7% ↗ 1.0% ETH $2,298 ↗ 0.3% ↘ 0.8% .  .  . ANALYSIS How I Stay Safe in DeFi Bankless Author: William M. Peaster Hacks and scams have extracted hundreds of millions of dollars from crypto projects so far in 2026. That's... not great. Of course, some of these attacks have been very sophisticated and drained protocols before their teams could even respond. Yet exploits come in many different forms, and DeFi users who double down on basic security practices can greatly improve their chances of avoiding trouble. The bottom line to transacting onchain is the buck stops with you. You have to do your own due diligence and implement your own defenses. To that note, I personally have a handful of steps (which basically haven't changed since DeFi Summer in 2020) that I use when exploring new DeFi projects in earnest. I hope these can serve you well now and for years to come, too. For some people these steps will seem obvious, many crypto users don't use more than 1-2 of them simultaneously. Layering them together gives you a common-sense first line of defense, and I'd recommend this to anyone. Accordingly, my DeFi safety checklist is as follows... 1. Start with the project docs Some crypto projects have sparse or nonexistent documentation, which drives me crazy. Good docs are expansive docs that explain protocol mechanics and also include stuff like audit reports, risk disclosures, etc. Whenever possible, and whenever you can find them, an app's docs should serve as your starting point. They give you a quick-start understanding of how a project works and, hopefully, its main security implications. For instance, this week I've been checking out Alchemix V3, which offers self-repaying loans against ETH and USDC, so I was recently surfing through docs.alchemix.fi/user. This one has some great resources, and I say that as someone who has seen droves of subpar docs. Alchemix's hub gives you a total bird's-eye view of the protocol, plus explicit pages for Risk Considerations and Security & Audits. This is precisely the info you want to vet early. However, this isn't the only info to look for. Also uncover what you can about a project's composability exposure. In other words, what other apps and tech does it touch? Alchemix's docs explain that the V3 yield flow is centered around Morpho V2 vaults, which in turn can interact with other external protocols like Aave. This sort of info catches you up on a project's strengths and pressure points so you can make informed decisions around them. 2. Check external analytics Once you have a research baseline from the docs, zoom out and learn what else you can about the project from neutral S-tier analytics platforms like Dune, DeFiScan, and DefiLlama. DefiLlama is particularly nice because beyond its bread-and-butter DeFi data (which is the industry's gold standard and is streamlined for analysts), the platform also offers an app directory of DeFi apps for visiting your desired projects directly and with ease of mind (in order to bypass scam results on Google, or cross-check whether a link you saw on X is legit, and so on). As far as digging into additional info, though, you're mainly looking to see if everything currently looks normal around your target project (e.g. is its total value locked stable or plummeting over the past day?) or if you can find anything problematic. One red flag is if a "DeFi protocol" isn't actually that decentralized, which is where reviewing projects on DeFiScan comes in handy. 3. Search X for recent updates X remains the town square of crypto. It's the place to search if you want to find the latest announcements from projects, particularly announcements related to security incidents. For instance, Alchemix had originally planned to lift its initial V3 deposit caps on April 20, but in the wake of the Kelp DAO exploit and in anticipation of more clarity around that incident (which has thankfully arrived), the project announced a pause on its cap-lifting plans. It wasn't an emergency that required action from users, but the post demonstrates that X is where you go to check for the latest updates and community discussions. Make a scan here before doing anything onchain just to be safe. 4. Start cautious, stay cautious Once you feel comfortable moving forward, create a test wallet siloed with only a small amount of funds, and use this for getting a feel for apps you haven't tried before. This way if something nefarious does happen, it's not your main wallet with the bulk of your holdings that gets hit. Fire off some transactions, like deposits and withdrawals, so you can verify that the underlying protocols behave as they're supposed to. Then if everything checks out, you can scale up your action. Just never deposit more than you can lose anywhere, and consider using a hardware wallet for your more dedicated activities to add a physical shield to your transactions. I'd also recommend setting up a Safe multisig (at least a 2/3) as your "main base," so to speak, and only send and receive funds here. Then rake back any crypto and yield from your DeFi wallet(s) to this multisig as you please, giving you a layer of separation between your action accounts and your vault wallet. 5. Simulate non-trivial transactions Once you're experienced with a DeFi project, you might want to start using it in size, but you can never be too safe. A great prophylactic measure you can take before executing large transactions is simulating them first. In other words, preview exactly how your desired transaction would play out before actually firing it off live onchain. For example, you can get a free account on Tenderly, a platform that, among other things, lets users simulate transactions across more than 100 Ethereum Virtual Machine (EVM) chains. The previews specifically show you whether your transactions will succeed or revert and what token balance changes would occur if they actually succeeded. However, if you want to keep things simple, wallets like MetaMask and Rabby have natively integrated Tenderly so that when you tee up transactions in them, their UIs automatically show transaction previews before you ever sign anything. They're easy avenues to take advantage of this capability. 6. Prune your token approvals When you interact with DeFi protocols, it's common to use your wallet to grant a token approval, i.e. permission to move a given token up to some specific limit. That said, unlimited approvals are prevalent and convenient in DeFi, but they create definite exposure. If a protocol you approved months or years ago gets exploited, an attacker could drain your max-approved balance regardless of whether you've used that project recently. With this vector in mind, make it a habit to periodically review and revoke the approvals you no longer need using a platform like revoke.cash, which lets you connect your wallet, see every open approval you have, vet how much money you have at stake, and remove approvals. As part of your ongoing onchain security regimen, go through these monthly and ax the ones you no longer use. Zooming out As I said in the intro, some DeFi exploits will be so sophisticated that there's not much you could do besides positioning, i.e. not having all your eggs in one basket, not depositing more than you can afford to lose, not using projects with multiple red flags. But ultimately the checklist I've outlined above matters because it will protect you from most of the lowest-hanging vectors. None of these steps are hard, and they become defensive force multipliers when you layer them together as good habits. The basics work, so use them! Share this Article FRIEND & SPONSOR: METAMASK Spend crypto online or IRL directly from your crypto wallet at over 150 million merchants worldwide—anywhere Mastercard is accepted. This is how you offramp: 3% cashback, zero foreign transaction fees, and exclusive benefits. Keep full custody of your funds until the moment you pay. Get the MetaMask Virtual Card now, free. Learn about MetaMask Card Manage your account Not financial or tax advice. Bankless content is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This newsletter is not tax advice. Talk to your accountant. Do your own research. Disclosure. From time to time, we may add links in this newsletter to products we use. We may receive a commission if you make a purchase through one of these links. Additionally, the Bankless team holds crypto assets. See our Investment Disclosures | Terms & Conditions | Privacy Policy Bankless © 2026 – Unsubscribe

With 95% of supply already mined, Bitcoin’s price is now driven more by global liquidity and institutional flows than halving cycles.

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	Forwarded this email? Subscribe here for more The Four-Year Cycle Bitcoin Playbook May No Longer Apply With 95% of supply already mined, Bitcoin’s price is now driven more by global liquidity and institutional flows than halving cycles. Bitcoin Magazine Pro Apr 24   READ IN APP   There’s a version of Bitcoin analysis that’s fairly simple: wait for the halving, expect a bull market for the following year or so, expect a bear market for roughly a year after that, repeat. It’s a framework that made sense for most of Bitcoin’s history. I’m not sure it does anymore, and this week I want to explain why, and what I think we should be looking at instead. This week at a glance: Over 95% of all bitcoin that will ever exist is already in circulation, significantly reducing the halving’s influence on supply dynamics. Bitcoin now has institutional passive flows from ETFs and treasury companies absorbing multiples of the daily new supply. Global M2 liquidity has an 85% correlation with Bitcoin’s price, and the macro backdrop is becoming more favorable. The ISM Purchasing Managers Index, a leading indicator of economic confidence, is showing early signs of recovery and has a strong historical correlation with S&P 500 forward returns. The Value Days Destroyed metric has just entered accumulation territory, regardless of where we sit on a calendar-based cycle timeline. Less Relevant The halving has historically been one of the most significant structural drivers of Bitcoin’s four-year cycle. An immediate 50% reduction in the daily supply of new coins entering the market is a meaningful economic event, and for much of Bitcoin’s history, when the asset was smaller, less liquid, and predominantly retail-driven, its price impact was substantial and relatively predictable. Figure 1: 95% of the finite 21 million bitcoin are already in circulation. View Live Chart Over 95% of all bitcoin that will ever exist is already in circulation. The inflationary rate is already so low that halving it again moves the needle considerably less than it once did. Meanwhile, Strategy alone is currently absorbing more than twice the entire daily new supply of bitcoin through ongoing accumulation. ETFs bought close to $650 million of bitcoin in a single day recently. The structural demand now entering this market dwarfs the supply changes that the halving produces. Liquidity The S&P 500 has a 96% correlation with Global M2 liquidity over the past 15 years on the monthly chart. Bitcoin has an 85% correlation with Global M2 over the same period. Closer to home, Bitcoin’s correlation with the S&P 500 itself sits at 93% over the same timeframe. These aren’t loose relationships; they’re some of the strongest cross-asset correlations in markets, and they tell you that what drives Bitcoin is predominantly the same macro force driving all risk assets: the availability of capital. Figure 2: Bitcoin’s correlation to the S&P500 is increasing. View Live Chart When you look at Global M2 on a year-on-year basis, measuring the rate of expansion and contraction rather than just the nominal level, Bitcoin’s alignment with liquidity cycles becomes even clearer. After a period of deceleration, the year-on-year M2 trend is beginning to show early signs of turning, which historically has been a meaningful tailwind for both equities and Bitcoin. If the four-year cycle framework is becoming less reliable, the question is what to replace it with. The answer, supported by over a decade of data, is global liquidity. Figure 3: Viewing Global M2 liquidity on a year-on-year basis illustrates its influence on Bitcoin. View Live Chart Shifting Macro Signals Beyond raw liquidity, the ISM Purchasing Managers Index, a measure of confidence and forward expectations in US manufacturing, has a historically strong correlation with Bitcoin price performance. When manufacturing sentiment improves, Bitcoin has tended to follow. We’re currently seeing early signs of recovery in this indicator after a period of deterioration, which, combined with the liquidity picture, suggests the macro backdrop is becoming more supportive rather than less. Figure 4: The historical relationship between Manufacturing PMI and Bitcoin price action. View Live Chart On-Chain Data Separately from the macro picture, the on-chain data is pointing in the same direction. The Value Days Destroyed Multiple, which weights coin movement by both the USD value and the dormancy of the coins being moved, then compares a 30-day average to the prior year’s average, has just entered its accumulation zone. This metric has a strong historical track record of identifying both overheated conditions at cycle peaks and undervalued conditions at cycle lows, and it’s currently at some of its lowest readings in recent history. Figure 5: The VDD Multiple has historically been a strong indicator of cycle highs and lows. View Live Chart Closing Thoughts Liquidity is expanding. Manufacturing sentiment is recovering. Institutional demand is structurally absorbing multiples of the daily new supply. And the on-chain data is pointing toward accumulation territory independent of where we sit on a four-year cycle timeline. This doesn’t mean cycles disappear. It means the halving is no longer the primary engine driving them, and waiting for a calendar date to dictate accumulation timing is increasingly difficult to justify with data. For a more in-depth look into this topic, watch our most recent YouTube video here: I Think The Bitcoin 4 Year Cycle Is Over, 93%+ Chance We Follow This Matt Crosby Director of Research & Analytics Bitcoin Magazine Pro For more detailed Bitcoin analysis and to access advanced features like live charts, personalized indicator alerts, and in-depth industry reports, check out Bitcoin Magazine Pro. Make Smarter Decisions About Bitcoin. Join millions of investors who get clarity about Bitcoin using data analytics you can’t get anywhere else. GO TO FREE CHARTS SIGN UP NOW We don’t just provide data for data’s sake, we provide the metrics and tools that really matter. So you get to supercharge your insights, not your workload. Take the next step in your Bitcoin investing journey: Follow us on X for the latest chart updates and analysis. Subscribe to our YouTube channel for regular video updates and expert insights. Follow our LinkedIn page for comprehensive Bitcoin data, analysis, and insights. Explore Bitcoin Magazine Pro to access powerful tools and analytics that can help you stay ahead of the curve. Invest wisely, stay informed, and let data drive your decisions. Thank you for reading, and here’s to your future success in the Bitcoin market! Subscribed Disclaimer: This newsletter is for informational purposes only and should not be considered financial advice. Always do your own research before making any investment decisions. We sincerely appreciate your support and hope you found this content valuable. Please leave a like and let us know your thoughts in the comments section; we always welcome feedback from our audience! Share Like & Comment Share Bitcoin Magazine Pro   Like Comment Restack   © 2026 BTC Inc. 438 Houston Street, Suite 257, Nashville, TN 37203 Unsubscribe