Over 97% of Crypto Hacks Have Targeted Defi Projects in 2022

The volume of illegal bitcoin transactions in the decentralized finance (Defi) market has significantly increased during the previous two years. This year, hackers have so far

digital assets worth close to $1.7 billion that have been stolen. The Defi protocols were targeted by 97% of hacking attempts.

One of the blockchain analytics firms is Chainalysis Report. North Korean hackers reportedly acquired more than 84 million dollars worth of

stolen property. Additionally, the employment of Defi protocols for money laundering has increased recently. The report outlines the difficulties these procedures face in

recognizing asset theft The lack of KYC in the majority of Defi schemes has made it easier for criminals to access them. The Lazarus Group, a recognized leader in cyber

activities, as indicated in the paper as having broken many protocols to steal bitcoins worth about $91 million last year. It is claimed

that money was taken from the stolen tokens by converting them into Bitcoin and Ether and sending them to regulated exchanges.

A recent breach of the NFT series Bored Ape Yacht Club (BAYC) Instagram account and Discord server prevented at least 54 BAYC NFTs.

It caused a loss of almost $ 137 million. The owner of BAYC, Yuga Labs, and Instagram have opened an investigation. A BAYC spokesperson stated that

A fake link to the website of the Bored Ape Yacht Club was made by the hacker. Later, consumers were prompted to join a fake airdrop by connecting their MetaMask to the con artist’s wallet.

When the attack was discovered, BAYC alerted its audience and removed all links from Instagram and other social media platforms. Furthermore, BAYC has made

Users who produce NFT on their behalf are breaking the law. The people who clicked on the fake airdrop link in this case are the victims. The wallet of the hacker’s

address was the recipient of the stolen NFTs.

Hackers’ Primary Target Is Defi

Since the Defi Boom in the summer of 2020, the number of illegal Defi transactions has steadily risen. The investigation by Chainalysis indicates that the two

The two main illegal actions on such protocols have been Defi hacking and money laundering.

Criminals stole digital assets worth $1.7 billion in total in 2022, with Defi procedures being responsible for 97 percent of the losses. $300,000,000 Wormhole

The two biggest thefts that contributed to the hoard were the February attack and the $600 million Ronin bridge breach at the end of March.

The study estimates that by 2022, hackers connected to North Korea will have collected almost $840 million in stolen money.

Over the past several years, hacking and Defi money laundering have both rapidly expanded, with Defi protocols getting 69% of the cryptocurrency-related transactions.

based on money associated with crime.

The bulk of such systems permits users to trade one token for another, according to the paper, because it is difficult to track the flow of digital assets.

Additionally, the majority of Defi schemes’ absence of KYC requirements has made them more appealing to criminals. The infamous Lazarus Group, which is connected

to the laundering of cryptocurrencies worth $91 million on several protocols last year with ties to North Korea and was cited as an example in the

research. Reportedly, the company transferred the stolen tokens to accounts on centralized exchanges, changed them to ETH and BTC, and then

cashed the money out.

Related

NFT Wash Trading

The study also included an interesting section on NFT Wash Trading, a method of market manipulation that artificially inflates an illiquid asset. NFTs could

transferred between wallets controlled by the same business, giving market participants the impression that demand is more than it actually is.

In one instance, fraud generated more than 650,000 wETH in transaction volume, according to the report. The market provided financial incentives for trading NFTs.

in the form of the website’s native token, indicating that the occurrences took place on the same platform.

By simply conducting additional transactions between accounts, users might boost their token profits. NFT collectors could be misled into thinking there’s more

than there truly is in the market in terms of transaction activity.

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