DeFi’s Losses from the Hacks Reached $6 Billion

The decentralized finance (DeFi) ecosystem saw a huge number of hacks in 2022. According to data from DefiLlama the total value of loss reached $6 billion

Hacks of DeFi

The Ronin Network, BSC Beacon, Wormhole, Nomad Bridge, Harmony Horizon, and Qubit Finance were among the most expensive cross-chain bridge hacks of 2022. But among all the hacks and security breaches, the Ronin hack seems to be the biggest DeFi disaster of the year. It is worth noting that according to Kofi, crypto data analyst at DefiLlama, the $6 billion figure is the value of the stolen funds at the time hack was acquired. Another crypto analyst Nelson Ijih appointed in his tweet that the figure would be even higher if other “crypto hacks” were included.

Different Hacking Techniques

DеFi hackers used various techniques to exploit vulnerabilities in Web3 projects. Many of the largest and most costly piracies of the year can be categorized into three categories: broken bridges, compromised keys, and flash loan exploits.

Broken Bridges

Broken bridges that link the blockchain ecosystem together were the main target of attackers.

Compromised Private

Compromised private keys, which generate digital signatures for blockchain transactions, were another way to hack DeFi. The examples of this type of hack are The Wintermute contract, Ankr, and Helio that saw losses due to compromised private keys.

Flash Loans

Flash loans that allow for a massive loan without collateral, were also one of the tools in DeFi hacks. Among the victims of flash loan exploits in 2022 were The Beanstalk and Mango Markets.

According to the report of Chainalysis, 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. Chainalysis also reported that North Korea was responsible for stealing a significant portion of those funds.

Source

https://u.today/

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