Analysis of Cryptocurrency Losses in May 2024
In the recent report by Immunefi for May 2024, the cryptocurrency sector faced significant financial setbacks due to hacks and fraudulent activities. The total number of reported failures in May reached 108, resulting in a cumulative loss of $473,229,944. This marks a 20% decrease from the previous year's data, which recorded total losses from hacks at $595,438,324. The decline in losses may signify improved security measures within the industry or a shift in cybercriminal strategies.
May 2024: Noteworthy Incidents and Financial Consequences
During May 2024, crypto investors and holders experienced losses amounting to $52,371,900 across 21 incidents. This figure is lower than the losses reported in May 2023, which stood at $59,344,389, and significantly less than the losses in April 2024, totaling $72,606,827.
The predominant financial impacts in May were attributed to two major events:
- Gala Games:
Gala Games, a prominent crypto gaming venture, suffered a significant loss of $21 million, making it the most substantial individual loss for the month. This incident underscores that even industry-leading projects like Gala Games are susceptible to risks, highlighting the pervasive nature of vulnerabilities in the sector.
- Sonne Finance:
Sonne Finance, a decentralized lending application, encountered a loss of $20 million. This case serves as a stark reminder of the inherent risks associated with DeFi lending platforms, particularly due to their significant transaction volumes.
Analysis of Hacks vs. Fraudulent Activities
Hacks remained the primary cause of financial losses in May 2024, constituting 96% of the total reported losses. Specifically, $50,618,600 was pilfered across 14 hacking incidents.
Contrastingly, fraud incidents remained relatively low, comprising only 3% of the total reported cases for the year, amounting to $1,753,300 from seven incidents.
DeFi decentralized applications bore the brunt of the exploits in May 2024, with a total reported loss of approximately $52,371,900 from 21 incidents involving fraud.
Chain-Specific Losses
The Ethereum and BNB chains were the primary targets during May 2024, collectively accounting for 62% of the total losses incurred by blockchain targets.
- Ethereum experienced losses nine times, contributing 43% to the overall losses.
- BNB Chain encountered four incidents, accounting for 19% of the total losses.
Other affected chains include Base, Arbitrum, Solana, TON, Blast, Fantom, Optimism, and Polygon, contributing 8% to the overall losses.
Conclusion
The data from May 2024 reflects a decline in overall crypto losses year-on-year and month-on-month. The prevalence of thefts targeting DeFi platforms persists, with Ethereum and BNB Chain remaining at the forefront in terms of losses. The evolving trends in cryptography underscore the critical need for robust security mechanisms and sustained efforts to combat cybercrimes.
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