The cryptocurrency sector has suffered losses exceeding $2.114 billion in 2024, significantly surpassing the 2023 total losses. The negative trend continues to grow despite security efforts.

Centralized Finance (CeFi) Incidents

Centralized exchanges have witnessed a dramatic rise in hacking incidents, with nearly a 1,000% increase year-on-year. The Japanese DMM Bitcoin exchange suffered one of the largest breaches, losing approximately $305 million. Turkey's BtcTurk also reported losses of $55 million, highlighting vulnerabilities within CeFi platforms. Overall, centralized exchanges accounted for around $401 million losses in just Q2 2024.

Decentralized Finance (DeFi) Trends

Despite the overall negative trend, DeFi platforms showed some resilience by reducing losses by 25% year-on-year. Still, $171.3 million was lost across 62 incidents, with Ethereum and BNB Chain as primary targets for exploits. While DeFi incidents reflect a more stable ecosystem compared to CeFi, the complexity of smart contracts and decentralized systems continues to expose users to risks.

Vulnerability Breakdown

From January to September 2024, there were a total of 131 reported incidents, representing a 197% increase from the same period in 2023. Major vulnerabilities include: 79 smart contract exploits and 51 access control violations. In 2023, there were 28 smart contract exploits and 16 access control violations. Access control vulnerabilities surged to $1.62 billion in 2024, a 99% increase from $742.6 million in the same period in 2023. Conversely, losses from smart contract vulnerabilities decreased by 19%, totaling $380.4 million this year compared to $429.6 million last year.

The surge in losses and incidents indicates the critical need for the cryptocurrency industry to enhance its security protocols. Cyvers stresses the importance of adopting real-time threat detection technologies and evolving regulatory frameworks.