Bug bounty hunting is a method for finding flaws and vulnerabilities in web applications; application vendors reward bounties, and so the bug bounty hunter can earn money in the process of doing so. Application vendors pay hackers to detect and identify vulnerabilities in their software, web applications, and mobile applications. Whether it's a small or a large organization, internal security teams require an external audit from other real-world hackers to test their applications for them. That is the reason they approach vulnerability coordination platforms to provide them with private contractors, also known as bug bounty hunters, to assist them in this regard.

Bug bounty hunters possess a wide range of skills that they use to test applications of different vendors and expose security loopholes in them. Then they produce vulnerability reports and send them to the company that owns the program to fix those flaws quickly. If the report is accepted by the company, the reporter gets paid. There are a few hackers who earn thousands of dollars in a single year by just hunting for vulnerabilities in programs.

The bug bounty program, also known as the vulnerability rewards program (VRP), is a crowd-sourced mechanism that allows companies to pay hackers individually for their work in identifying vulnerabilities in their software. The bug bounty program can be incorporated into an organization's procedures to facilitate its security audits and vulnerability assessments so that it complements the overall information security strategy. Nowadays, there are a number of software and application vendors that have formed their own bug bounty programs, and they reward hackers who find vulnerabilities in their programs.

The bug bounty reports sent to the teams must have substantial information with proof of concept regarding the vulnerability so that the program owners can replicate the vulnerability as per how the researcher found it. Usually the rewards are subject to the size of the organization, the level of effort put in to identify the vulnerability, the severity of the vulnerability, and the effects on the users.

Statistics state that companies pay more for bugs with high severity than with normal ones. Facebook has paid up to 20,000 USD for a single bug report. Google has a collective record of paying 700,000 USD to researchers who reported vulnerabilities to them. Similarly, Mozilla pays up to 3,000 USD for vulnerabilities. A researcher from the UK called James Forshaw was rewarded 100,000 USD for identifying a vulnerability in Windows 8.1. In 2016, Apple also announced rewards up to 200,000 USD to find flaws in iOS components, such as remote execution with kernel privileges or unauthorized iCloud access.

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