Before a smart contract or protocol goes live, its team typically commissions a security audit: a structured review in which outside specialists read the code line by line, run automated scanners for known vulnerability patterns, and design test cases meant to break the system before an attacker does. The process usually combines automated static analysis with manual review by two or more independent auditors, since tools alone are good at flagging textbook bugs but poor at spotting logic errors specific to a protocol's design.
Auditors focus on failure categories that have repeatedly drained funds across the industry: reentrancy, broken access controls, oracle price manipulation, flawed upgrade mechanisms, and integer or rounding errors. Findings are ranked by severity, the team ships fixes, and reputable firms perform a remediation review to confirm the patches work and did not introduce new issues. The final report is usually published so users can judge a project's diligence for themselves.
An audit reduces, but never eliminates, risk. It generally cannot catch problems outside the reviewed code, such as a compromised admin key, a phished team member, or unaudited off-chain infrastructure. Several of the largest 2026 DeFi exploits hit protocols that had already passed multiple audits, because attackers went after people and infrastructure instead of contract logic. For that reason, an audit is best treated as one layer alongside formal verification and an ongoing bounty program, not a one-time guarantee of safety.