Written by: nour

Translated by: Chopper, Foresight News

During the DeFi Summer of 2020, Andre Cronje was releasing new protocols almost every week, with Yearn, Solidly, and many other experimental projects emerging. Unfortunately, many of these projects encountered contract vulnerabilities and economic attacks, leading to user losses. However, those that survived became the most important protocols today.

The problem is that the era left psychological scars on the entire industry. The industry's direction shifted dramatically, pouring vast resources into security. Multiple audits, audit competitions, and each version requiring months of review, all to validate an idea that had no market fit. I think most people did not realize how much this stifled the spirit of experimentation. No one would spend $500,000 and wait six months for an audit for an unproven idea. So everyone merely replicated verified designs, calling it innovation. DeFi innovation did not vanish; it was merely stifled by the incentive mechanisms.

And all of this is changing, as AI is driving down security costs at an astonishing pace.

AI audits once seemed laughably simplistic, basically only able to highlight superficial issues like reentrancy and precision loss that any competent auditor could find. But the new generation of tools is completely different. Tools like Nemesis can now detect complex execution flow vulnerabilities and economic attacks, possessing an astonishing depth of contextual understanding of protocols and their operating environments. What stands out particularly about Nemesis is its way of handling false positives: it allows multiple agents to detect using different methods, and results are judged by another independent agent, filtering out false positives based on contextual understanding of the protocol logic and goals. It can truly understand nuances, like in which scenarios reentrancy is acceptable and in which cases it is truly dangerous. This is where even experienced human auditors often make mistakes.

Nemesis is also extremely simple, requiring only three Markdown files to be added as skills to Claude Code. Other tools go further, some integrating symbolic execution and static analysis, while others can even automatically write formal verification specifications and validate the code. Formal verification is becoming accessible to everyone.

But all of this is still just the first generation of tools. The models themselves are still evolving. Anthropic's forthcoming Mythos is expected to surpass Opus 4.6 significantly. You don’t need to make any modifications; just run Nemesis on Mythos to immediately achieve stronger effects.

Combining this with Cyfrin’s Battlechain radically restructures the entire security workflow: Write code → AI tool audit → Deploy to Battlechain → Real-world offensive and defensive testing → Redeploy to the mainnet.

The beauty of Battlechain is that it eliminates the implicit "security expectations" of the Ethereum mainnet. All users entering via cross-chain are aware of the risks they face. It also provides a natural focal point for AI auditors, eliminating the need to search for needles in the haystack of the mainnet. Its security harbor framework stipulates that 10% of stolen funds can serve as a legitimate bounty, creating economic incentives that drive the development of more powerful attack tools. Essentially, it’s competition similar to MEV, but occurring in the security field. AI agents will probe every new deployment at lightning speed, racing to find vulnerabilities.

The future process for DeFi protocol development will be:

1. Write protocol
2. Complete AI audit in minutes
3. Deploy to Battlechain with a small amount of funds
4. Automatically targeted by competing AI agents
5. Attacked in minutes
6. Recover 90% of funds
7. Fix vulnerabilities
8. Redeploy

From finishing the code to practical verification and then onto the mainnet, the whole cycle compresses from months to possibly just a few hours, with costs that can be nearly negligible compared to traditional audits.

The final line of security will be wallet-level AI audits. User wallets could integrate the same AI audit tools at the transaction signing phase. Before every transaction is signed, AI will audit the target contract code, read state variables to associate all relevant contracts, untangle the protocol topology, understand the context, audit contracts and user transaction inputs, and provide recommendations in the confirmation popup. Each user will ultimately run their own professional-level auditing agent to protect themselves from rug pulls, team negligence, or malicious front ends.

Agents will comprehensively guard DeFi protocols from the development layer, public chain layer, and user layer. This reopens the entire experimental design space. Ideas that were previously economically unviable due to high security costs can finally be tested. A person in their bedroom can now quickly iterate to create a billion-dollar protocol, just like Andre and others did in 2020. The era of online testing has returned.