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Cryptocurrency Scams Jump 150% in Q3 as Losses Reach $685 Million

Hackers are targeting cryptocurrency projects with a visible increase in the total amount of such incidents during the 3rd quarter.

The report was shared by blockchain data analysis firm named ImmuneFi which claimed that the total number of cryptocurrency attacks during 3rd quarter of the ongoing year have increased by 153% in comparison to last year. The firm reported that during last year around 30 crypto projects were under fire from hackers.

However, this year the number has increased to 76. On this account, the total amount of losses accumulated from this hack attack series is estimated to be around $885 million. In comparison, the value of amount lost last year was estimated to be $429 million.

One of the major attacks in the series affected Mixin Network and Multichain as per Mitchell Amador, the CEO of ImmuneFi. He noted that these attacks were traced back to state-backed actors who were targeting various crypto enterprises this year.


Professional Hackers are Targeting Blockchain Projects

Investigators from South Korea have tracked back the attacks on Mixin Network and Multichain with losses valued in $200 million and $126 million subsequently to North Korean hackers. Lazarus Group is a name that appears time and again when it comes to the most notorious hacking professionals in the world.

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This group is said to be backed by the North Korean government and was also involved on attacks at CoinEx, Alphapo, Stake, and CoinsPaid during the previous quarter.

Hackers have been estimated to have racked in around $200 million from the aforementioned crypto exploits. 97% of the token reserves in these attacks were siphoned as a result of the hacking. Meanwhile, 3% were lost due to scams.

Decentralized Finance or DeFi protocols bear the lion’s share of damage in the incident. At the same time, decentralized exchanges lost around $500 million while centralized exchanges suffered from $185 million in losses.

The main cause of increase in these attacks is attributed to the increasing sophistication of such groups. Another factor associated with this issue is the complexity of smart contracts coding used as the foundation for DeFi apps.

Hackers Steal $480 Million from DeFi Protocols

A report published by PeckShield claims that hackers managed to steal around $480 million from various DeFi protocols during the first half of the financial year 2023.

This report was published last month and it claims that the main hackers were able to breach various DeFi protocols through oracle manipulation, logic bugs, and privilege exposure.

In comparison to 2022, attacks on DeFi decreased by 75% during the first half of 2022. The total value of losses in DeFi hacks was valued at $2.5 million.

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Hack Incidents via Oracles

It is important to note that logical errors occur when developers are writing smart contracts. Hackers are able to find these loopholes and use them to breach the protocol. Meanwhile, oracles are off-chain sources that smart contract use to collect data.

Hackers are able to change the quality and speed of the data through oracle channels leading to malfunction. Privilege attacks happen with hackers intercepting their target using app permissions that users grant in order to operate and access the program.

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Hassan Mehmood (Saudi Arabia)

Hassan is currently working as a news reporter for Tokenhell. He is a professional content writer with 2 years of experience. He has a degree in journalism.

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