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William Parvez
William Parvez

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Crypto Losses Surge in Q2 2024 Amid Hacks and Fraud

Cryptocurrency and decentralized finance (DeFi) sectors suffered a staggering $572 million in losses due to hacks, scams, and exploits in the second quarter of 2024, more than double the amount lost in the same period the previous year, according to a report by blockchain security firm Immunefi.

The report found that losses totaled almost $573 million in Q2 2024, with $564 million lost to hacks across 53 incidents and $8.4 million lost to fraud in 19 incidents. This represents a 112% increase compared to Q2 2023, when hackers and fraudsters stole $265.4 million.

The two largest incidents accounted for a significant portion of the losses. A hack on the Japanese exchange DMM Bitcoin resulted in a staggering $305 million loss, while the Turkish exchange BtcTurk incurred a $55 million loss, together making up 62.8% of all losses in Q2 2024.

Hacks continued to be the predominant cause of losses at 98.5%, while fraud accounted for only 1.5% of the total. Centralized protocols and exchanges suffered approximately $401 million in losses during the quarter, representing 70% of the total, despite making up only a small percentage of the total number of successful attacks.

The Ethereum blockchain bore the brunt of the attacks, experiencing 34 incidents that led to nearly $264 million in losses, representing 46.6% of the total losses across targeted chains. The BNB Smart Chain also saw significant losses, with 18 incidents accounting for 24.7% of the total.

The report also noted that there is nearly $100 billion in capital locked across web3 protocols as of June 2024, which represents an attractive opportunity for blackhat hackers.

Despite the overall increase in losses, there was some good news. Approximately $26.7 million, or 5% of the total losses, was recovered from stolen funds in four specific situations. Some of the recovered funds included the attacker who exploited the Gala Games protocol returning nearly all of the funds, and Alex Labs, Bloom, and Yolo Games recovering most of the funds lost from their exploits.

The persistent security issues highlighted by the findings may pose challenges for platforms seeking to demonstrate the robustness and reliability of their systems, especially as the industry grapples with increased regulatory scrutiny and attempts to attract institutional investors.

In conclusion, the surge in crypto losses from hacks and fraud in Q2 2024 underscores the ongoing security challenges facing the cryptocurrency and DeFi sectors. While some funds were recovered, the significant losses emphasize the need for robust measures to safeguard the ecosystem and restore confidence in the industry.

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