Study Reveals $12 Billion Lost Over Hacks and Scams, Mostly DeFi Users!
- DeFi platforms have grown in popularity in recent years.
- These losses include direct financial losses to Dapps and token holders.
According to a recent study by Elliptic, the worldwide leader in crypto asset risk management, billions of dollars have been stolen through decentralized finance (DeFi) protocols.
According to Elliptic’s report DeFi: Regulation, Compliance, and the Growth of DeCrime, users, and investors have lost over $12 billion due to malicious exploitation of weaknesses in decentralized apps (Dapps) such as decentralized exchanges (DEXs), lending protocols, and asset management products. These losses include direct financial losses to Dapps and token holders linked with these protocols.
DeFi Platform Easy Target
DeFi platforms have grown in popularity in recent years, fueling the crypto asset boom. TVL, a measure of DeFi services liquidity, has risen from $500 million in November 2019 to slightly more than $247 billion today.
Elliptic’s term DeCrime refers to financial crime using decentralized financial technologies such as Dapps. Theft and criminal losses across DeFi platforms have surged 600% since 2020. With $10.5 billion taken since January 2021 vs $1.5 billion last year. Malicious exploitation of DeFi has cost over $12 billion.
Tom Robinson, Chief Scientist at Elliptic, said:
“The DeFi ecosystem is an incredibly exciting and fast-moving space, with financial services innovation happening at light speed. This is attracting large amounts of capital to projects that are not always robust or well-tested. Criminal actors have seen the opportunity to exploit this.”
The research blames the frequency of DeFi theft and criminality on the unproven and immature technologies available. Bugs in decentralized applications created by designers and developers are the most prevalent source of losses, accounting for $10.8 billion. Exit scams refer to when a Dapp author purposely leaves a ‘backdoor’ in the code that lets them steal users’ payments and “admin keys” theft costs another $1 billion.
The post has appeared first on thenewscrypto.com
Read more: https://thenewscrypto.com/study-reveals-12-billion-lost-over-hacks-and-scams-mostly-defi-users/
Text source: TheNewsCrypto – Blockchain & Cryptocurrency News M
