Crypto Hacks and Scams Surge in Q2, Costing Crypto Industry Over $573 Million

The second quarter of 2024 was a tumultuous period for the crypto industry. There were 72 incidents where $572.7 million were lost to hacks and scams during this quarter, says the quarterly report from Immunefi. This is an enormous leap from $336.3 million that were lost in the previous quarter marking a whopping 70.3% increase and almost double too when compared against $265.5 million that disappeared within just one quarter back in 2023.

Major incidents impacting CeFi and DeFi platforms

It has been a common occurrence over the years that DeFi platforms, where almost $100 billion in value is deposited at any given time, have attracted cybercrime disproportionately. This narrative changed during the second quarter just ending; CeFi platforms took the hit. In other words, CeFi as a whole lost $401.4m or 70% as compared to DeFi’s $171.3m.

The headlines for this quarter have been dominated by two major issues that accounted for $360 million, which corresponds to 62.8% of all losses. The primary hack  incident was registered following a 305-million-dollar breach of a Japanese cryptocurrency trading platform for DMM Bitcoin while the second one involved a $55 million theft from BtcTurk, a Turkish crypto exchange, on June 23rd.

High monthly losses and limited recovery

May 2024 was marked by significantly high losses reaching $358.5 million thus establishing itself as the month with the highest loss in the quarter. However, out of all money that was stolen during this three-month period ($571.93), just 5% ($28.7) could be traced back to its source. And this percentage was sustained from four different hacking practices on other related enterprises like Bloom or ALEX Lab or Gala Games or YOLO Games.

Predominance of hacks and key Blockchain targets

The amount of money lost in Q2 was due mainly to hacks which amounted to $564.2m in 53 cases, constituting 98.5% of all hacked funds for the period. However, scams made up just 1.5% of the total loss valued at $8.5m during 19 separate incidents.

Ethereum and BNB Chain were the most targeted blockchain networks. On these networks, 34 incidents resulted in 46.6% of the total losses that occurred on Ethereum which was most affected. Following closely behind it was BNB Chain which had 18 incidents accounting for 24.7% of the loss. Arbitrum, Blast, Optimism, Solana, Polygon, Fantom, Linea, Mantle, and TON were also some of the minor incidents suffered by smaller networks.

Year-Over-Year increase in crypto losses

In addition, the report demonstrated that there was an increase in crypto losses year to year. This comes at a time when theft-related losses are growing faster than any other time in the history of the virtual currency market. 

Comparatively, in the previous year, the amount of money that was lost to hacking and deceitful acts skyrocketed by 112%, which indicates that cyber-crimes targeting businesses dealing with digital cash have become more complex and common nowadays. The total loss from thefts, scams, and hacks since January 2018 stood at $920.9, representing a twenty four percent rise from $702.9 million in 2023.

According to Mitchell Amador, CEO Immunefi, some instances of high losses in millions were caused by a single infrastructure compromise. He also said that in Q2, hacking attacks on CeFi infrastructure which was the most affected resulted in growth of losses that exceeded DeFi,despite less number of hacks in this sector.

Also Read: High-Profile Twitter Accounts Hacked in New Crypto Scam Surge