Key Takeaways
- Out of $413 Million, $409 million was stolen by hackers while the rest was lost to fraud.
- Report stressed that private key management continues to be a major challenge for centralized platforms.
In the third quarter of 2024, crypto hacks and scams amount to $413 million in losses as per a report by blockchain security firm Immunefi. This marks a 40% decrease compared to the same period last year. In the second quarter of 2024, the crypto industry lost an estimated $509 million to hacks.
Out of $413 Million, $409 million was stolen by hackers while the rest was lost to fraud. The report points out decentralized finance (DeFi) protocols as the primary target for crypto hacks. Immunefi explained that the large amounts of capital locked in DeFi platforms — currently valued at $87.2 billion, according to DefiLlama — make them particularly attractive to hackers.
The most significant losses during the quarter came from breaches at centralized cryptocurrency exchanges. India’s WazirX exchange lost $235 million, while Singapore’s BingX exchange suffered a $52 million hack. In total, 32 other hacks contributed to 32% of the quarter’s total losses. A Singapore court has granted WazirX a four-month moratorium for repayment.
Mitchell Amador, founder and CEO of Immunefi, highlighted the difference between attacks on decentralized and centralized platforms. “We’re seeing more incidents targeting DeFi, but when centralized exchanges (CeFi) are hit, the consequences are often far worse, with hundreds of millions lost in a single exploit,” Amador explained.
The Immunefi report stressed that private key management continues to be a major challenge for centralized platforms. Amador pointed out that poor key management practices put user funds at risk, stating, “In CeFi, the biggest infrastructural issue is private key management. It’s essential for maintaining self-custody of crypto assets but often lacks thorough security audits.”
While hacks accounted for the majority of losses, rug pulls only accounted for $3 million, less than 1% of the total. This represents a sharp 86.4% drop in fraud-related losses compared to the third quarter of 2023. The Ethereum blockchain was the most frequently targeted, with 15 hacks reported. BNB Chain followed with eight incidents, while Base saw two hacks.
In Q1 2024, losses dropped by 23%, but the second quarter saw a resurgence in losses due to several high-profile private key hacks. In Q2, the most notable hack was suffered by Japanese centralized exchange DMM Bitcoin, which lost a staggering $305 million.
