Title: Bug Bounty Proposal by Hats Finance #2022-10-B001
Date Created: 12.10.2022
Date Published: 17.10.2022
The direct losses from hacks and exploits between 2020-2022 are above $15B, and yet, the solutions currently being offered are not decentralized, permissionless, scalable, and continuous like Map Protocol is.
This is a proposal for Map Labs to collaborate with Hats.finance to create an on-chain, free, and permissionless incentives pool for hackers/auditors to protect the Map Protocol smart contracts. The goal of the vault is to incentivize responsible vulnerability disclosure for Map Protocol. Liquidity can be added (with $MAP and/or yield-bearing tokens) permissionless and LPs will be rewarded with $HAT tokens once the liquidity mining program is launched.
Hats.finance is a on-chain decentralized bug bounty platform specifically designed to prevent crypto-hack incidents by offering the right incentives. Additionally, Hats.finance allows anyone to add liquidity to a smart bug bounty. Hackers can disclose vulnerabilities responsibly without KYC & be rewarded with scalable prizes & NFTs for their work.
Smart bug bounty programs are a win-win for everyone. They can be created easily with a few on-chain transactions (it takes less than 1 hour to set up a vault on Hats), and are free of charge. Hats will only charge a fee once an incident has been successfully mitigated. The protocol will retain 10% of the payout as fee from the security researcher. Scenarios of an exploit are way more costly and can cause irreversible damage. More importantly, the bounty program is transparent, decentralized, and gives power to the community of the project.
The key advantage of Hats solution compared to traditional, centralized bug bounty services:
- Bug bounty vaults are loaded with the native or yield bearing token of each project. Reducing the free floating supply while giving the token additional utility.
- Scalable bounty network — vault TVL increases with success / token appreciation of the project.
- Open & Permissionless — Anyone can participate in the protection of an asset they are a stakeholder of and any hacker, anywhere in the world, can participate anonymously when disclosing exploits (no KYC needed)
- In the future when providing liquidity(taking risk) every depositor could earn $HATS tokens.
- Continuous — As long as tokens are locked in the vault, hackers are incentivized to disclose vulnerabilities through Hats, instead of exploiting the project.
# Financial Implications
We propose 5 million $MAP from Ecosystem DAO to be granted to be used as a initial deposit for the bug bounty vault to be open to the community deposit. This fund will be used as the bounty for white hat hackers, who responsibly disclose vulnerabilities regarding the Map Protocol.
# Success Metrics or KPIs
- 21 Bounty Vaults
- $1.7m TVL (12th of October)
- 25% of TVL from the community (12th of October)
- Strong growth in the community of security researchers
# Next Steps
In case that the proposal gets accepted, MAP DAO is expected to:
1- Choose and set up a committee
2- Vote on the amount the DAO will contribute to the bug bounty program (How much $MAP or yield bearing assets to be used from the treasury for the initial deposit)
Onboarding action items:
- Choosing a committee: The committee is preferably the public multisig contract of Map Protocol or a multisig specifically set up to manage the bounty program.
The Committees responsibility:
- Triage incoming vulnerability reports/claims from auditors/hackers (get back to the reporter within 12 hours).
- Approve claims within a reasonable time frame (Max. of 6 days)
- Set up repositories and contracts under review. (A list of all contracts covered by the bounty program separated by severity)
At Hats.finance, we envision a future in which a security marketplace acts as permissionless infrastructure for the crypto ecosystem. Considering how much Map Protocol cares about the security of the network and its operations, it is beyond any doubt that a bounty on Hats.finance will draw more attention from the white hat hackers and auditors to the smart contracts of Map Protocol. Accordingly, each scrutiny will contribute to the safety and security of Map Protocol.
We would love to see the discussion going in detail and get feedback on the proposal.