Crypto companies often find out the hard way that hackers know their security systems better than they do. As hacks in the crypto world can and often do result in hundreds of millions of dollars worth of tokens being stolen, the fate of a company’s future can often ride on its security measures. In an effort to batten down the hatches, companies offer bug bounties.
These bounties are essentially competitions in which hackers are encouraged to try to compromise software. The hackers then submit a vulnerability report to the respective companies so that they are able to patch the bugs before they are exploited. As a reward, successful hackers are paid a bounty.