Crypto losses from hacks and scams skyrocketed in the second quarter of 2024, more than doubling compared to the same period the previous year. According to research from blockchain security platform Immunefi, the total losses amounted to $572 million, a significant increase from $220 million in Q2 2023. This surge reversed a previous downward trend in such losses.
Centralized exchanges bore the brunt of these losses, with significant hacks contributing to the sharp increase. Before this quarter, losses from hacks and scams had been declining. Immunefi reported a 23% reduction in Q1, and this trend continued through April and most of May. However, the end of May and June saw a dramatic spike in losses.
Major Hacks Drive Losses
The most substantial single loss in Q2 2024 was from a private key hack of the crypto exchange DMM on May 31, which resulted in the theft of $305 million worth of Bitcoin. This incident alone accounted for more than half of the total losses for the quarter. Another major hack occurred on June 22, when BtcTurk suffered a $55 million loss. Combined, these two hacks represented over 62% of the total losses for the quarter.
Centralized protocols and exchanges experienced approximately $401 million in losses, making up 70% of the total. Despite the significant monetary impact, the number of successful attacks on centralized protocols was relatively low. Only five attacks were successful, compared to 62 successful exploits or scams involving decentralized protocols.
DeFi Protocols and Targeted Networks
Decentralized finance (DeFi) protocols also faced substantial losses, though to a lesser extent than their centralized counterparts. DeFi protocols saw $171 million in losses during the quarter, a 25% decrease from Q2 2023.
Ethereum and the BNB Smart Chain remained the top two networks targeted by scammers and hackers, accounting for 71% of the total losses. However, there is evidence suggesting that Ethereum layer 2 networks are becoming increasingly popular among malicious actors.
Security and Recovery Efforts
In response to these alarming figures, Immunefi’s founder Mitchell Amador emphasized the critical importance of securing centralized exchange infrastructure. He stated, “This quarter highlights how infrastructure compromises can be the most devastating hacks in crypto, as a single compromise can lead to millions in damages. This was evident during this quarter, where losses surged primarily due to hacks targeting CeFi infrastructure, surpassing DeFi, despite a smaller number of hacks in that sector. Robust measures to safeguard the entirety of the ecosystem are crucial.”
Some of the stolen funds were later recovered by security researchers. For instance, the attacker who exploited the Gala Games protocol returned nearly all the stolen funds. Reports suggested that the attacker had connected to his wallet without using a virtual private network (VPN), exposing his IP address and leaving him vulnerable to potential prosecution, though this was never confirmed.
The Road Ahead
The second quarter of 2024 serves as a stark reminder of the ongoing security challenges in the cryptocurrency space. The sharp increase in losses from hacks and scams underscores the need for robust security measures across both centralized and decentralized platforms. As the industry continues to grow and evolve, the importance of protecting digital assets from malicious actors cannot be overstated.
The insights from Immunefi’s report highlight the critical areas where improvements are needed. Centralized exchanges, in particular, must enhance their security protocols to prevent such devastating losses. Meanwhile, the continued targeting of major networks like Ethereum and BNB Smart Chain indicates that these platforms must remain vigilant and proactive in their security efforts. As the cryptocurrency landscape develops, stakeholders must prioritize security to foster a safer and more resilient ecosystem. With high-profile figures like Keisha Lance Bottoms advocating for the unifying potential of crypto, it’s clear that the industry must address these challenges head-on to ensure the long-term viability and trustworthiness of digital assets.
I am Toby Rothschild, Co-Founder of Spearmint and author at Coinography, and a strategist focused on advancing Web3 innovation, digital ecosystems, and the future of decentralized technology. I combine product thinking, creative leadership, and deep interest in emerging trends to help shape how individuals and organizations interact with the next generation of digital systems.
My work centers on understanding how blockchain, AI, and digital identity are reshaping global industries. At Spearmint, I help lead the direction of initiatives that bring clarity, structure, and meaningful user experiences to complex technological environments. I focus on bridging vision with execution, ensuring that innovation remains practical, scalable, and aligned with long-term growth.
As an author at Coinography, I create insights that translate fast-moving Web3 developments into clear, useful narratives. I explore topics such as decentralized governance, digital identity, creator economies, token models, protocol design, and the shifting cultural patterns around emerging technology. My aim is to make digital transformation more understandable and approachable for a wider audience.
I believe that Web3 is not only a technological shift but a cultural and creative one. Strong ideas, thoughtful communication, and human-centered design will shape which technologies thrive and how communities evolve around them. My writing and research reflect this belief, focusing on clarity, relevance, and long-term perspective.
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