In 2022 the global Web3 space was valued at over $934 billion. This lucrative market has become attractive for hackers to target.
The team behind Immunefi, a leading bug bounty and security services platform, took a look at the state of crypto in 2022. In this assessment, the volume of crypto funds lost due to hacks and scams over the last year was analysed.
Immunefi reviewed all instances where blackhat hackers have exploited crypto protocols with malicious intent. In addition, cases of protocols that allegedly performed a rug pull in 2022 were also looked at. These are crypto scams in which fraudulent bodies lie to the public in a bid to attract funding.
Crypto losses
The review was able to find 168 instances. This includes both successful and semi-successful hacking attempts, as well as alleged cases of fraud. Total losses of $3,948,856,037 across the Web3 ecosystem were found in 2022. Of this, £3,773,906,837 was lost to hacks in 2022 over 134 incidents. A further $174,949,200 was lost to fraud across 34 specific incidents.
Most of these losses are accounted for by four large specific projects. The first is the Ronin Network hack. Developer and publisher Sky Mavis revealed that approximately $625 million worth of cryptocurrency had been stolen from the Ronin Network. Others such as Binance attempted to help raise funds to reimburse the loss.
Speaking of Binance they too suffered losses in 2022. When the BNB Chain was targeted, hackers were able to move tokens off the BNB network. This resulted in losses of around $570,000,000. Filling in the top spot for losses, however, is FTX. As we now know, FTX has suffered a massive collapse at the hands of ex-CEO Sam Bankman-Fried.
Hacks vs Fraud
The five biggest losses of the entire year totalled a huge amount of $2,361,000,000 alone. This accounts for 59.8% of all losses within the year. Hacks themselves were the most predominant causes of losses at 95.6%. This is in comparison to frauds, scams and rug pulls which only comprised 4.4% of losses.
The loss of $3,773,906,837 due to hacks is marked as an increase compared to 2021. This number represents a 58.3% increase compared to the year before when total losses due to hacks were $2,384,164,452. So overall hacks have been worse in 2022 than they were the year before.
Interestingly, fraud losses are the opposite. In 2022 losses of $174,949,200 were lost to fraud across 34 incidents. This number is a massive 96.9% decrease compared to 2021. Losses amounted to $5,704,173,200 in only 14 incidents.
Despite the figure of $3,948,856,037 is a huge sum for losses in 2022, this figure represents an overall decrease compared to 2021. That year saw huge losses due to hacks and fraud, accounting for losses of $8,088,288,239.
Paige Cook is a writer with a multi-media background. She has experience covering video games and technology and also has freelance experience in video editing, graphic design, and photography. Paige is a massive fan of the movie industry and loves a good TV show, if she is not watching something interesting then she's probably playing video games or buried in a good book. Her latest addiction is virtual photography and currently spends far too much time taking pretty pictures in games rather than actually finishing them.
