How can a decentralized exchange be hacked?

Smart contracts, the underlying logic of decentralized exchanges cannot be altered once they are live on the blockchain. If there are problems with the logic of the smart contract for any reason, hackers can exploit these vulnerabilities and steal the funds stored in these smart contracts. In a recent wormhole whitehat, smart contract bounty a hacker known as Satya0X noticed a proxy smart contract that was not initialized properly on Wormhole. He was paid $10 million for that. That is just a side note to highlight the importance of security in blockchain. To stay safe, only use protocols that have been audited by top crypto auditing firms like Certick and Hacken. Also, check details about the project on Apeoclock and Rugdocs to ensure you are safe.