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DeFi Hacks Top $6 Billion

Sun, 02/05/2023 - 12:56
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Alex Dovbnya
DeFi hacks have surpassed $6 billion in losses in 2022, according to crypto data analyst Kofi
DeFi Hacks Top $6 Billion
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The decentralized finance (DeFi) ecosystem saw a surge in hacks in 2022, with the total value of stolen funds surpassing $6 billion, according to data from crypto data analyst Kofi, a contributor at DefiLlama.

The year was marked by a number of high-profile hacks and security breaches, with the Ronin hack leading the pack as the biggest DeFi disaster of the year.

According to Kofi, the $6 billion figure represents the value of the stolen funds at the time they were originally stolen. Nelson Ijih, a crypto analyst, tweeted that the figure would be even higher if other "crypto hacks" were included.

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DeFi attackers utilized a wide range of techniques to exploit vulnerabilities in Web3 projects. However, many of the most significant and expensive hacks of the year can be grouped into three categories: broken bridges, compromised keys, and flash loan exploits.

Broken bridges, which link the blockchain ecosystem together, proved to be a prime target for attackers. The Ronin Network, BSC Beacon, Wormhole, Nomad Bridge, Harmony Horizon, and Qubit Finance were among the most expensive cross-chain bridge hacks of 2022.

Compromised private keys, which generate digital signatures for blockchain transactions, were another avenue for DeFi hacks. The Wintermute contract, Ankr, and Helio were among the protocols that suffered losses due to compromised private keys.

Flash loans, which allow for a massive loan without collateral, were also a common tool in DeFi hacks. The Beanstalk and Mango Markets protocols were among the victims of flash loan exploits in 2022.

As reported by U.Today, Chainalysis, a New York-based analytics firm, recently reported that the value of illicit cryptocurrency transactions reached an all-time high of a staggering $20.1 billion in 2022, which represents a 40% increase from the previous year. North Korea was responsible for stealing a substantial portion of those funds. 

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About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at