Immunefi Says Half A Billion Crypto Lost In Hacks And Frauds

Immunefi Says Half A Billion Crypto Lost In Hacks And Frauds

According to Immunefi, the second quarter of the year saw a total of $59 million of crypto lost to frauds and hacks.

The crypto bug bounty platform revealed that it was a 9% rise from the same period in the last year.

The report

The report revealed that the crypto industry had experienced its highest losses ever in May 2024. The said losses reached $107 million.

In comparison, the month of June recorded a decline in losses. They dropped to $78 million and were compromised in 12 different scenarios.

In June 2023, the losses had stood at $107 million, which makes it a 27% decline for the month in this year.

In this quarter, the highest losses were recorded on DMM Bitcoin, which is a centralized exchange based in Japan.

Hackers managed to get away with a staggering sum of $305 million. However, the exchange has put several measures in place since then for reimbursing its clients.

Some of the other platforms that recorded exploits include Gala Games, BtcTurk, SonneFinance, Lykke, and Hedgey. Their total losses stood at $164.2 million.

The target

The Immunefi report revealed that the most targeted places were centralized financial institutions. Almost two-thirds of the attacks that were successful were aimed at these institutions.

According to a cybersecurity business analyst, centralized entities are a favorite of hackers because they have centralized storage and extensive asset pools.

Therefore, they are more vulnerable to hacks. As compared to DeFi platforms, centralized ones have bigger pools of assets.

Therefore, hackers consider them a lucrative target because they can maximize their returns in just one attack.

Moreover, centralized entities also attract hackers due to their use of centralized wallets and repositories. Plus, their security measures and private key management are also big draws.

The analyst said that there can be single points of failure due to centralization. Hence, hackers can use one breach to access a considerable amount of funds.

Other factors

The analyst further asserted that DeFi platforms have had to face a great deal of regulatory scrutiny. Indeed, regulators have not spared centralized platforms either.

But, the former have had to deal with greater scrutiny due to which they have implemented far tougher and stricter security measures than centralized ones.

Therefore, hackers find it difficult to target them for attacks. In the second quarter, the blockchain that experienced the most attacks was Ethereum, which recorded 44.4% of the attacks.

25% of the attacks happened on the BNB chain, while Arbitrum recorded 5.6% of the attacks. Immunefi’s Communication Lead, Jonah Michaels, highlighted why Ethereum was the most targeted.

He said that the blockchain is a hotbed for DeFi activity and its ecosystem currently holds the highest amount of funds.

Therefore, it has become a target for hackers because they can make significant gains when they exploit the various protocols based on it.

Furthermore, Ethereum is also connected to major privacy chains and they can also be used for laundering stolen funds.