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Centralized Exchanges Hit Hard as Crypto Theft Nears $1.4 Billion in 2024, Cyvers Report Reveals

Centralized exchanges have become the primary targets for crypto thefts in 2024, according to Cyvers’ mid-year Web3 security report.

The total volume of stolen cryptocurrency is nearing $1.4 billion this year.

The second quarter of 2024 saw over $600 million in crypto losses, doubling the amount from the same period in 2023.

This dramatic increase is largely due to a 900% rise in thefts from centralized exchanges.

“This quarter has witnessed a significant shift in attack vectors, with centralized exchanges (CEX) bearing the brunt of major incidents, while decentralized finance (DeFi) protocols show improved resilience,” the report stated.

“This trend may be attributed to the concentration of assets in centralized platforms and potentially lax security measures in some exchanges.”

Access control breaches, particularly phishing attacks, were responsible for most of the stolen funds, totaling about $490 million in Q2.

In contrast, smart contract exploits resulted in less than $70 million in losses during the same period.

DeFi protocols have managed to protect users through quick action to freeze compromised smart contracts, although Cyvers warned that new vulnerabilities in complex contracts continue to pose risks.

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Cross-chain bridges are also emerging as significant targets, with the report highlighting the $1.44 million exploit of XBridge in April.

A major incident impacting Cyvers’ Q2 data was the breach of Japanese cryptocurrency exchange DMM in May, where a compromised private key led to over $300 million being stolen.

Additionally, Turkish cryptocurrency exchange BtcTurk suffered a $50 million loss to hackers in June.

The report noted a positive trend in the recovery of stolen funds, with a 42% increase in recovered funds in Q2 compared to the same period in 2023.

However, the majority of stolen funds (around 76%) remain unrecovered.

Cyvers emphasized the need for vigilance among Web3 users, highlighting emerging threats from artificial intelligence and quantum computing, which could provide hackers with advanced tools to bypass onchain security measures.

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Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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