The article explores the effectiveness of bug bounty policies, which pay ethical hackers to identify vulnerabilities in a company’s cyber infrastructure. It highlights how these programs have become a crucial part of cybersecurity strategies, allowing companies to leverage external expertise. The literature review discusses various studies showing that bug bounties can be cost-effective compared to traditional security measures, as they provide a broad pool of talent and diverse perspectives on potential security issues. The findings indicate that bug bounty programs significantly enhance a company’s security posture. Companies that implement these policies tend to discover and fix vulnerabilities more quickly, reducing the risk of breaches. However, the effectiveness of these programs depends on clear guidelines, adequate rewards, and proper management of submissions. The article emphasizes that while bug bounties are economically beneficial, they must complement, not replace, other security measures.