In November 2024, the world of decentralized and centralized finance showcased an alarming pattern—hacks and security breaches dominated the landscape, accounting for an astounding 99.96% of total losses across the sector. This presents a stark contrast to the previous year’s figures, indicating that while decentralized finance (DeFi) showed signs of resilience, hackers are increasingly honing in on weaknesses within the financial infrastructure. According to a recent analysis by Immunefi, shared with CryptoPotato, the total losses recorded in DeFi reached approximately $71 million for the month—a significant drop from the $343 million suffered during the same period in 2023.
Despite the decline in losses attributed to fraud and rug pulls, which only accounted for $25,300 across two incidents, the findings underline a worrying trend: centralized finance (CeFi) is becoming an easier target for cybercriminals. The report highlighted that nearly 50% of year-to-date (YTD) losses—amounting to an alarming $724 million—originated from breaches within CeFi. This marks a substantial shift, given the historical decrease in such attacks in recent years. Notably, the third quarter of 2024 saw CeFi hacks comprising 72% of total losses, with a single incident at India’s WazirX exchange causing a staggering $235 million loss alone.
Underlying Causes of Security Breaches
Examining the underlying factors contributing to these breaches reveals a troubling reality. The vulnerability of infrastructure, particularly regarding hot wallets used in CeFi platforms, creates a breeding ground for catastrophic cyberattacks. Statistics illustrate that just nine significant CeFi attacks this year were responsible for losses equivalent to 200 breaches occurring in DeFi. This ratio emphasizes the sheer scale and impact of these events, underscoring a pressing need for enhanced security measures and protocols.
As cyber threats evolve, hackers are continuously refining their strategies. Techniques such as impersonating recruiters or employing deceitful hiring methods have emerged, enabling them to infiltrate financial security systems more effectively. This sophisticated approach to cyberattacks often goes undetected until substantial damage has been inflicted, raising concerns about preparedness and response measures across financial institutions.
Focusing on targeted blockchain networks reveals that BNB Chain was disproportionately affected, suffering fourteen attacks that accounted for nearly half—46.7%—of losses in November alone. Ethereum also stood out with nine incidents, showing a 30% contribution to total losses for the month. In contrast, other blockchain networks such as Solana, Polygon, and others collectively experienced minimal attacks, indicative of varying degrees of security and exposure across these platforms.
Zooming out to analyze the broader implications, the year-to-date losses across the ecosystem have reached a staggering $1.49 billion resulting from 209 distinct incidents, with the months of May and July marking particularly devastating points in the year, exceeding losses of $359 million and $282 million, respectively. These figures serve as a wake-up call for both investors and companies operating in the financial sector to prioritize security and devise stronger countermeasures against an evolving threat landscape.
The 2024 financial landscape starkly emphasizes the ongoing vulnerability of both DeFi and CeFi systems, warranting an urgent and concerted effort to enhance cybersecurity protocols to safeguard the future of digital finance.
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