In 2024, pig butchering scams were the biggest threat to crypto users, leading to $3.6 billion in losses, according to Web3 security firm Cyvers.
Increase in Attacks in 2024
The report indicates a 40% rise in cyberattacks in 2024 compared to 2023, with 165 incidents costing $2.3 billion in damages. Although this was down 37% from the peak fraud levels in 2022, complex schemes and breaches surged this year. Access control breaches accounted for most of the damage, with 67 incidents totaling $1.9 billion. Other attack vectors included smart contract vulnerabilities, leading to $456.8 million in losses, and address poisoning assaults, resulting in $68.7 million in a single major case.
What is Pig Butchering?
Pig butchering refers to a method where scammers groom victims through unsolicited messages, drawing them into fake crypto schemes. With trust established, scammers deploy smaller cash inductions to siphon off larger amounts, often in Tether (USDT) via less transparent exchanges like Binance, HTX, OKX, Crypto.com, and Coinbase. Illicit funds are laundered through decentralized and centralized exchanges before cashing out.
Recovery Attempts
Despite the losses, around $1.3 billion was recovered to victims in 2024, primarily through on-chain detectives and bug bounty programs. The first quarter of 2024 saw the highest number of incidents at 53, while about $760 million was lost in Q3. The fourth quarter marked the lowest activity and losses.
Educating users on crypto interactions and security measures, according to Cyvers CEO Deddy Lavid, is crucial in reducing the success of scams. This requires greater transparency in exchange operations and heightened user vigilance.
