CipherTrace: DeFi protocol hacks surpass $99 million since the start of the year

The amount of funds stolen in 2020 by attackers from decentralized finance protocols reached $99.5 million. The total damage to the crypto industry from hacker activity amounted to $468 million, according to a report by analytics firm CipherTrace.

Experts noted that the DeFi sector appears attractive to hackers due to its unregulated nature and anonymity. Analysts say that the protocols are particularly vulnerable to fraud and money laundering.

“DeFi protocols, by design, are not subject to censorship. Often this points to a lack of clear regulatory compliance and the possibility of access for anyone without passing KYC. As a result, the sector may serve as a haven for those who launder money,” they explained.

In the first half of the year, the amount of funds lost in the DeFi sector to attackers totalled $51.5 million; from July to date, $48 million.

Source: CipherTrace.

Analysts included in the sample three successful attacks on the DeFi platform bZx with a total damage of $9 million. Also among those named were dForce and Harvest Finance.

The decline in the share of DeFi hacks in the second half of the year is linked to a successful attack on the cryptocurrency exchange KuCoin. The hacker managed to withdraw assets worth almost $281 million.

CipherTrace experts urged DeFi project developers to scrutinise the operation of the smart contracts they create more thoroughly.

As reported by Atlas VPN, since 2012 the blockchain industry has lost more than $13.6 billion as a result of 330 hacker attacks.

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