Crypto losses from hacks and scams nearly doubled in Q2 2024 compared to the same period in 2023.
After relative safety throughout 2023 and 2024, centralized exchanges became the primary target in the last quarter, suffering over 70% of stolen funds.
Hacks on DMM and BtcTurk exchanges accounted for over 60% of all losses in Q2.
Ethereum and BNB Smart Chain were the most targeted by attackers.
After a relatively quiet first quarter of the year, the second quarter of 2024 saw a massive increase in losses from crypto hacks and scams.
Between April and June, Immunefi's most recent quarterly report shows that the crypto market saw an almost doubling in the amount stolen relative to a year-on-year comparison with the same period in 2023.
Here’s how hackers and scammers managed to steal nearly $600 million in three months.
Immunefi published its quarterly report on Thursday, earlier this week.
This report shows that in Q2 2024, the crypto industry saw around $572 million worth of crypto and other digital assets stolen between April and June, marking a staggering 113% increase from the $220 million lost in Q2 2023.
Interestingly, for most of the year, centralized exchanges remained relatively untouched by hackers and scammers, leaving Defi and other decentralized protocols to bear the brunt of these attacks.
Defi versus Cefi
However, this time around, Centralized exchanges were the worst hit, being hit with more than 70% of the stolen funds during this period.
It is also worth mentioning that before this quarter, even from 2023, there had been a decline in crypto losses from hacks and scams, with Immunefi reporting an impressive 23% reduction in Q1 2024.
The market even remained relatively safe through April and most of May.
However, the tides started to shift between late May and June, leading to a complete table-flipping and more than a half billion in losses.
Immunefi reports that centralized protocols took a brutal $401 million hit during the quarter, making up around 70% of all the stolen funds.
However, despite the large amounts of money stolen, the Centralized protocol hacks were notable in that only five were successfully attacked.
Conversely, despite losing significantly more than the centralized protocols, Defi had around 62 successful exploits or scams, all of which saw around $171 million stolen—a 25% decrease from Q2 in 2023.
Some of the most significant losses in Q2 2024 occurred around 31 May, during the hack of Japan's DMM crypto exchange.
During this hack, the exploiters stole around $305 million worth of Bitcoin, causing a temporary intra-day crash of around 2% and around $45 million worth of bullish and bearish liquidations, according to data from TradingView and Coinglass.
Major Incidents In Q2
Another major hack came from the incident at BtcTurk, a Turkish crypto exchange, on 22 June.
The BtcTurk exploiters managed to steal an additional $55 million, with the BtcTurk and DMM hacks accounting for over 62% of the total losses for the quarter.
Due to their relative sizes and market shares in the Defi world, Ethereum and the BNB Smart Chain remained some of the worst-hit networks by scammers and hackers, accounting for 71% of total losses.
Immunefi mentioned something interesting, though.
Ethereum Layer 2 scaling solutions are starting to become more inviting to hackers, with Optimism, Blast, and Arbitrum, in particular, being the third most targeted networks.
Between April and June, Arbitrum alone suffered four of 62 attacks, which contributed around 5.5% to the total $171 million in stolen funds.
On the bright side, security researchers managed to recover some of the stolen funds, with the incident at Gala Games being a prime example.
According to reports, researchers were able to trace the attacker's IP address after they connected their wallet to receive the stolen funds without a VPN.
Moreover, others like Alex Labs, Bloom, and Yolo Games recovered most of their losses, which amounted to about 5% of the stolen funds during the quarter.
Overall, with the start of the second half of the year already upon us, the intensified efforts of the industry's bad actors present a new challenge for users, protocol moderators, and security research teams alike.
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