Crypto Attacks Hit Almost $1.4B in 2024 With Increased Target on CEXs – Report

Crypto hacks continue to escalate amid increasing technological innovation t in the industry. According to Cyvers’s mid-year Web3 security report, crypto exploits hit approximately $1.4 billion in Q2 2024. 

The report also revealed that fraudsters’ target shifted from decentralized finance (DeFi) to centralized finance (CeFi) in Q2 2024. As a result, centralized crypto exchanges (CEXs) recorded a 900% year-over-year increase in stolen funds. 

Hackers’ Targets Shift from DeFi to CeFi in Q2 2024

The cybersecurity company’s mid-year Web3 and crypto security report revealed that CEXs are the new base of hackers.

🚨 2023 had staggering $1.7B in hack losses, but 2024 is expected to be much worse with $1.38B lost in the first half of the year!

Cyvers’ Q2 2024 report shows a 35% rise in crypto losses, with centralized exchanges facing the brunt 📊

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— Cyvers | Proactive Web3 Security (@Cyvers_) July 8, 2024

The digital asset hacks in Q2 2024 exceeded $600 million across 49 different indicents, marking a 100% increase from the value recorded in Q2 2023. 

The figure brought the year-to-date cumulative crypto loss to $1.38 billion as of the first half of 2024. Also, it reflected the growing threats in the Web3 and crypto space amid increasing innovative technology.

Moreover, the report noted that the bad actors focused primarily on centralized exchanges to steal crypto funds, translating to a 900% rise in losses in Q2

However, it mentioned that decentralized finance (DeFi) protocols suffered less from attacks in the quarter. The DeFi space has beefed up its security measures to become less susceptible to fraudulent exploits.

Cyvers stated in the report: “This quarter has witnessed a significant shift in attack vectors, with centralized exchanges (CEX) bearing the brunt of major incidents while decentralized finance (DeFi) protocols show improved resilience.

The report pointed out that CEXs account for about 65% of total losses in crypto in Q2 2024. As an example, the security firm cited the Japanese DMM Bitcoin incident in May, which led to a loss of $305 million in crypto. 

This attack marked the biggest hack since December 2022 and the third-largest exploit in cryptocurrency history.

The report noted that hackers devised several means to drain and steal crypto funds from victims during the quarter under review. 

The trends include address poisoning, smart contract exploits, access control breaches, etc. Through address poisoning, exploiters stole about $71,475,000 in crypto funds. Smart contract exploits and access control vulnerabilities accounted for losses worth $67,378,000 and $491,311,000, respectively.

Further, some crypto losses came through flash loan attacks as hackers exploited temporary breaches in liquidity protocols. They also use oracle manipulations to exploit price feeds for arbitrage possibilities.

Another trend involved cross-chain attacks that exploited vulnerabilities in bridge protocols to drain funds across blockchains.

Meanwhile, the bad actors exploited DeFi protocols with privacy-enhancing features to launder money. They also used AI algorithms to automate and optimize the transfer of stolen funds and distort traditional tracking measures.

Moreover, hackers have become more innovative with post-exploit approaches to money launderingThey used cross-chain bridges to conceal their tracks while transferring their stolen proceeds to several chains. 

Disclaimer: The opinions expressed in this article do not constitute financial advice. We encourage readers to conduct their own research and determine their own risk tolerance before making any financial decisions. Cryptocurrency is a highly volatile, high-risk asset class.

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