With about $1.3 billion worth of cryptocurrency stolen, a study being published by cryptomonday.de researchers reveals that 97% of the stolen funds were obtained through decentralized finance (defi) protocol exploits.
In terms of stolen cryptocurrencies from hacks and exploits, 2022 is already breaking records. Last year, $3.2 billion in digital currencies were stolen, and 2022 has already accounted for more than 40% of 2021’s total during the first quarter alone. The stolen cryptocurrency data was obtained from a report published by cryptomonday.de and the study’s author, Elizabeth Kerr. According to the report’s author, “the numbers indicate a significant spike.”
For example, 97 percent of the $1.3 billion in digital currencies stolen this year came from defi protocols. In the first quarter of 2021, only 72 percent of the stolen funds came from defi, while in 2020, the figure was as low as 30 percent. Furthermore, the majority of theft in 2022 was caused by faulty code exploits in which smart contract errors were used to siphon stolen money from defi protocols. According to the author, because the defi environment is open source, anyone can search the codebase of a defi project for vulnerabilities and errors.
According to the research, centralized exchanges were popular honeypots in previous years, but attacks on centralized trading platforms have decreased. “[Centralized exchange attacks] now account for less than 15% of [stolen] cryptos,” writes Kerr. According to the report, common defi protocol hacks took the form of flash loan attacks and security breaches. The report’s author also mentions the Ronin bridge attack, which resulted in a $600 million loss.
“Hackers and cybercriminals stole more than $3.2 billion last year, and if the first quarter is any indication, we may see even more stolen this year.” “The need for tighter security measures grows by the day, especially as more people join,” explained Jonathan Merry, CEO of Cryptomonday, in a statement.
