Cryptocurrency theft escalated dramatically in the second quarter, with losses from hacks and scams soaring by 112% to a staggering $572 million, the latest data revealed. This sharp increase followed a period of decline, highlighting a troubling resurgence in malicious activities targeting the crypto community, especially centralized exchanges.

Escalating Crypto Losses

Immunefi, an on-chain crowdsourced security platform, reported that the total losses amounted to $572,688,861, marking a significant rise from the $265,481,519 lost in the second quarter of last year. Centralized exchanges were the main victims, reversing the previous trend of declining losses.

The majority of the losses resulted from two major incidents. DMM Bitcoin, a Japanese crypto exchange, suffered a colossal $305 million loss, while Turkey’s largest cryptocurrency exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term, BtcTurk, reported a $55 million loss. These two events alone accounted for 62.8% of the total losses in Q2.

Hacks continued to dominate as the primary cause of crypto losses. Out of the total $572,688,861 lost, $564,238,811 resulted from hacks across 53 incidents, representing a 155% increase compared to the same period last year. Fraud, including scams and rug pulls, accounted for a smaller portion, with $8,450,050 lost across 19 incidents. This represents an 81% decrease from the same period of last year.

Centralized Finance (CeFi) platforms were the main targets, suffering 70% of the total losses, while Decentralized Finance (DeFi) platforms accounted for the remaining 30%. CeFi platforms experienced a staggering 984% increase in losses, with $401,400,000 lost across five incidents. In contrast, DeFi platforms saw a 25% decrease, with losses totaling $171,288,861 across 62 incidents.

Most Targeted Blockchains

Among the most targeted blockchains, Ethereum and BNB Chain were the most targeted blockchain Blockchain Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Blockchain comprises a digital network of blocks with a comprehensive ledger of transactions made in a cryptocurrency such as Bitcoin or other altcoins.One of the signature features of blockchain is that it is maintained across more than one computer. The ledger can be public or private (permissioned.) In this sense, blockchain is immune to the manipulation of data making it not only open but verifiable. Because a blockchain is stored across a network of computers, it is very difficult to tampe Read this Term networks in Q2 2024. Ethereum faced 34 incidents, representing 46.6% of the total losses, while BNB Chain witnessed 18 incidents, accounting for 24.7% of the losses. Other chains, such as Arbitrum, Polygon, Solana, and Fantom, experienced fewer attacks but still contributed to the overall losses.

Despite the high volume of losses, there were some successes in recovering stolen funds. Approximately $26,736,000, or 5% of the total losses, was recovered in Q2 2024, a slight improvement from the 3.9% recovery rate in Q2 2023. This indicates progress in tracking and reclaiming stolen assets, although challenges remain.