Bug Bounty: A bug bounty refers to a reward system offered by software owners or organizations, including those in the cryptocurrency industry, to encourage individuals to identify and report vulnerabilities, glitches, or security issues in their computer software or systems. This practice aims to detect and address potential weaknesses before malicious actors can exploit them.
In the realm of cryptocurrencies, bug bounties are frequently initiated by businesses such as cryptocurrency protocols, exchanges, and wallet providers. These bounty programs can be seen as friendly competitions, inviting security experts and ethical hackers to participate. They are typically made public, allowing security researchers to scrutinize the software thoroughly, with the understanding that the organization offering the bug bounty can promptly address any identified vulnerabilities.
The value of bug bounties is often determined based on the severity of the reported vulnerability. While some low-severity issues may result in relatively modest bounties, critical vulnerabilities can yield substantial rewards, sometimes exceeding $10,000 or more. In 2018, the bug bounty ecosystem paid out nearly $900,000, according to data from HackerOne.
Certain individuals, often referred to as white hat hackers, have made substantial incomes from identifying and reporting bugs. An example is Guido Vranken, a Dutch researcher who earned $120,000 from EOS after discovering 12 bugs in just one week.
It’s essential to recognize that bug bounties are not a standalone security solution but rather a supplementary measure. The primary focus for software developers is to construct secure code and minimize vulnerabilities prior to product release. Bug bounties serve as a crucial secondary line of defense, helping software owners and users safeguard their systems against potential threats and malicious activities.