Crypto Industry Losses in 2023

The crypto industry has surpassed more than $1.2 billion in losses this year due to 154 hacks and scams — a 15.5% increase year-over-year, according to the latest report from web3 bug bounty and security services platform Immunefi.

Monthly Loss Overview

Despite a dramatic 95% month-over-month drop during August, where losses were only $15.1 million compared to $274.7 million in July, August’s losses stemmed from five specific incidents, marking the lowest monthly loss year-to-date and a 38% decrease compared to August 2022. The majority of the losses came from one incident alone: a $12 million outflow to MEV bots from the Ronin Network bridge due to an upgrade bug on August 6.

However, the outflow was later attributed to white hats, who returned the funds in exchange for a $500,000 bounty. Ronin’s bridge with Ethereum had previously been hacked for over $600 million in March 2022. An exploit of five validator keys lost 173,600 ETH (approximately $590 million at that time) and $25.5 million of the stablecoin USDC — marking the largest DeFi exploit in history.

DeFi protocol Nexera incurred the second-largest loss in August, with $1.5 million stolen. VOW, Convergence Finance, and iVest DAO accounted for the remaining losses, with no recorded CeFi incidents this month.

Hacks continued to be the predominant cause of losses in August, accounting for 100% of the losses.

Targeted Networks

Ethereum and BNB Chain

Ethereum and BNB Chain were the most targeted networks, accounting for all of this month’s losses. Ethereum suffered three individual attacks, while BNB Chain experienced the other two incidents.

In June, Immunefi surpassed $100 million in ethical hacker and researcher payouts which spanned three years resulting from over 3,000 bug bounty reports. The largest payout was $10 million for a vulnerability discovered in Wormhole’s cross-chain protocol.

Last month, Immunefi partnered with the Ethereum Foundation to launch “Attackathon” — a large-scale collaborative audit contest for the Ethereum network.

Immunefi claims to operate the largest blockchain security community, comprising over 45,000 researchers, saving over $25 billion in user funds across protocols like Polygon, Optimism, Chainlink, The Graph, Synthetix, and MakerDAO from being stolen.