Saturday, 28 January 2023

Crypto News

DeFi security loses rose 47.4% in 2022 to hit $3.64B: Report

DeFi security loses rose 47.4% in 2022 to hit $3.64B: Report

According to a Jan. 5 report published by Chinese blockchain security firm LianAn Technology, decentralized finance, or DeFi, exploits across blockchains worldwide totaled $3.64 billion in 2022. This represented a rise of 47.4% compared to the loss of $2.44 billion in 2021. The incidents increased in quantity despite a steep 80% loss in DeFi total value locked during the year. 

DeFi losses by quarter in 2022 | Source: LianAn Technology; Footprint Analytics

Out of the 2022 amount, funds lost during cross-chain bridge hacks amounted to $1.89 billion across 12 incidents — the highest in the category. Overall, attacks on the Ethereum, BNB, and Solana chains accounted for the majority of exploits.

Out of the 167 notable incidents in 2022, 51.5% of breaches occurred in audited projects, while 48.5% of breaches occurred in non-audited projects. In total, LianAn said 38.7%, or $1.40 billion, of stolen funds were laundered via cryptocurrency mixer Tornado Cash. Only $289 million worth of funds have been recovered throughout the year. However, the number is likely higher as several recoveries have yet to be publicly disclosed per law enforcement request. 

Total global blockchain-related crimes (financial crimes excluded) amounted to $13.7 billion in 2022. Incidents of money laundering topped the list with $7.33 billion, followed by DeFi exploits ($3.6 billion), multi-level marketing scams ($1.0 billion), and fraud ($830 million). Aside from the collapse of cryptocurrency exchange FTX, there were 243 incidents of fraud, and rug pulls during the period, with $425 million in total dollar amount involved.

“2022 was a grim year for the security of the global blockchain industry. This leads to a greater and more pressing demand for security expectations in 2023. How to respond against hacker attacks, how to quickly build a global regulatory framework, and how to apply technical breakthroughs to resolve security threats are all pressing issues we must consider and resolve in 2023.”