Losses From Crypto Hacks Soar 60% to US$1.9 billion

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According to a blog post by blockchain analysis firm Chainalysis, losses from hacks of cryptocurrencies soared by almost 60 percent from January to July to US$1.9 billion, compared with US$1.2 billion stolen from hacking in the same period last year.

A steep increase in funds stolen from the decentralized finance (DeFi) protocols contributed mainly to this increase. DeFi applications are financial platforms that enable crypto-denominated lending outside traditional banks.

The exploitation of DeFi protocols is unlikely to end any time soon. In the first week of August, attackers hacked cross-chain bridge Nomad in a US$190 million heist. In addition, attackers hacked several Solana wallets and stole US$5 million worth of cryptocurrencies.

Much of the money stolen from the DeFi protocols are linked to North Korean threat actors said to have stolen approximately US$1 billion worth of cryptocurrencies from the DeFi protocols.

Crypto scams recorded a sharp 65% decline through July, in line with the collapse in the price of digital assets. Overall, revenue from fraud in the year to July was US$1.6 billion, down 65% from the same period last year, when it was US$4.46 billion.

Since January 2022, revenues from fraud have fallen in line with the Bitcoin exchange rate. While revenues from fraud have fallen, the total number of individual transfers to fraudsters in 2022 was the lowest in the last four years.

The sources for this piece include an article in Reuters.

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