Ethereum Leads as Most Targeted Chain Amid Crypto Hacks and Frauds in Q2 2024

• In a significant shift, crypto losses due to hacks and frauds have seen a drastic downturn in Q2 2024, decreasing by an impressive 112% compared to the same period in the previous year, based on recent findings from Immunefi.
• Detailed analysis shows that the Web3 landscape witnessed around $572 million in losses during April, May, and June, which is notably higher than the $265.4 million recorded in Q2 2023.
• An overwhelming 98.5% of these losses stemmed from hacks, with significant incidents occurring at exchanges like Japan’s DMM Bitcoin, which faced a $305 million breach, and Turkey’s BtcTurk, impacted by a $55 million intrusion.

Discover the dramatic decrease in crypto-related frauds and the shifting dynamics in the Web3 ecosystem as hackers dominate the landscape.

Immunefi Reports a Shift in Crypto Losses in Q2 2024

Recent data from Immunefi reveals a substantial transformation in the pattern of crypto losses, where the total losses surged to $572 million in Q2 2024, in stark contrast to the $265.4 million documented in the same quarter of the previous year. This period saw hacks overwhelmingly responsible for these losses, significantly overshadowing scams and frauds.

Hacks Responsible for Majority of Crypto Losses

Hacks accounted for a staggering 98.5% of the total losses, primarily driven by significant incidents such as the $305 million exploit on DMM Bitcoin in Japan and the $55 million breach on the Turkish exchange BtcTurk. In contrast, fraud-related losses considerably shrank to $8.45 million, marking an 81% decrease from the prior year.

Centralized vs. Decentralized Finance: Loss Distribution

Centralized finance (CeFi) projects were disproportionately affected, constituting 70% of the stolen funds from just five incidents. On the other hand, decentralized finance (DeFi) protocols experienced 62 incidents but only accounted for 30% of the total losses. This highlights a significant concentration of high-value hacks targeting CeFi platforms.

Ethereum: The Prime Target for Crypto Hacks

Ethereum emerged as the most targeted blockchain, suffering 34 incidents which represented 46.6% of the losses across all chains. BNB Chain followed with 18 incidents, contributing 24.7% to the losses. Several Ethereum layer-2 solutions, including Arbitrum, Optimism, and others, also experienced multiple breaches, collectively representing a minor segment of the attacks.

Diverse Targets Across Various Blockchain Networks

While Ethereum and BNB remained the primary targets, other blockchain networks like Polygon, Solana, and Fantom also experienced security breaches, albeit to a lesser extent. Arbitrum recorded four incidents, accounting for 5.5% of the total losses across chains, while networks like Optimism and other smaller chains cumulatively represented 15% of incidents, each facing singular attacks.

Conclusion

The recent findings point toward an evolving threat landscape within the crypto industry, where hackers are progressively focusing on more centralized platforms and prominent blockchains like Ethereum. Despite the uptick in overall financial losses, the remarkable reduction in fraud and scam-related incidents suggests that certain preventive measures may be yielding positive results. Stakeholders in the crypto space must continue to enhance security protocols to mitigate the risks posed by increasingly sophisticated cyber-attacks.