According to a new report, hackers have so far stolen $ 100 million from decentralized finance projects (Defi) this year. Defi accounted for 50% of all hacks and thefts in the second half of the year.
Defi Hacks on the rise
A new report from blockchain threat intelligence and cryptocurrency forensics firm Ciphertrace shows that $ 100 million was stolen from decentralized finance (Defi) this year. The company detailed Monday:
In the first six months of 2020, 45% of all thefts were Defi hacks, equivalent to approximately $ 51.5 million, 40% of the volume hacked for that time period. So far, in the second half of 2020, Defi has dominated 50% of all thefts, amounting to approximately $ 47.7 million – 14% of the volume of hackers for this period of time.
The report explains that the percentage of low volume in the second half of the year is due to the large $ 281 million Kucoin exchange hack that occurred in October. Excluding the Kucoin incident, Defi accounted for over 50% of the total volume of thefts and hacks during the time period. “Although Kucoin is a centralized exchange, this hack was also touched by Defi when the criminals attempted to launder the stolen funds through one of the largest decentralized exchanges in the world – Uniswap,” the report adds.
So far, the total of the Defi protocol and hacking exchanges has been around 21% of the total volume of hacks and thefts. By comparison, the volume of Defi’s hacks was almost negligible in 2019. The report elaborates:
The USD value locked in Defi has grown exponentially in 2020 thus creating new potential money laundering risks as hacked Defi protocols make up the majority of cryptocurrency thefts in 2020 and decentralized exchanges have been the ramp of choice for the Kucoin hack of 2020.
“This boom is ultimately what attracted criminal hackers to Defi, resulting in the majority of Defi attacks in a year to date,” the report continues.
According to Defi Pulse, the total value locked in Defi is currently $ 13.42 billion, an increase of nearly 700% since the beginning of the year. Uniswap leads the group, followed by Maker, Wbtc, Compound, Aave and Curve Finance.
The United States Securities and Exchange Commission (SEC) and other global regulators are starting to pay more attention to Defi. “The EU has introduced Markets in Crypto-Assets (MiCA), a proposed regulation which, if approved, will prohibit decentralized exchanges from trade with any citizen of the European Union if they are not incorporated as a legal entity and have their registered office. in one Member State “, details the report.
The Financial Action Task Force (FATF) already considers decentralized exchanges in its guidelines, and the Financial Crimes Enforcement Network (FinCEN) applies the same regulatory consideration to DEXs as it does to bitcoin ATMs.
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Image credits: Shutterstock, Pixabay, Wiki Commons, Ciphertrace
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