Blockchain ecosystems experienced a significant increase in hacking incidents, with losses jumping 50 percent from the previous year. A recent report by cybersecurity firm SlowMist revealed that there were a total of 223 blockchain security incidents in the first half of 2024, compared to 185 incidents during the same period in 2023. The total losses from these incidents reached $1.43 billion, a significant increase from the previous year.
Among the different blockchain ecosystems, Ethereum suffered the most losses, with a staggering $400 million. This can be attributed to its popularity and its prominent position in decentralized finance (DeFi) projects. DeFi entities were found to be the most frequently attacked, accounting for 70.85 percent of the total incidents and resulting in losses of $659 million. This represents a 37.29 percent year-on-year increase in losses.
The primary reason for these security breaches was vulnerabilities in blockchain contracts, including bugs in the code. Additionally, “rug pulls,” which involve scamming investors by raising funds through selling digital tokens and disappearing with the money, were another significant cause of security incidents.
Trading platforms alone accounted for $524 million in losses during the first half of the year. The largest security incident on a trading platform occurred on May 31 when Japanese crypto platform DMM Bitcoin was attacked, resulting in the illegal transfer of over 4,500 Bitcoins and losses of approximately $305 million.
In May, two brothers in the United States were arrested for attacking the Ethereum blockchain and stealing $25 million. They tampered with and manipulated transaction processes and protocols to gain access to pending private transactions and alter them for their own gain. This incident was the first of its kind and highlighted the vulnerabilities within the Ethereum blockchain.
Another notable attack targeted the Ethereum Foundation, a nonprofit organization supporting Ethereum and related technologies. Hackers used the foundation’s email account to send scam emails to its members, encouraging them to click on a malicious link. Although the foundation took control of the situation and prevented further harm, it highlighted the need for enhanced security measures.
These incidents underscore the importance of robust security measures within the blockchain ecosystem. As the popularity of blockchain technology continues to grow, it becomes increasingly crucial for developers and organizations to address vulnerabilities and implement effective security protocols. This will not only protect individuals and businesses from financial losses but also help build trust in the blockchain industry as a whole.
