Crypto Theft Doubles to $1.4 Billion in H1 2024

The first half of 2024 saw a significant increase in crypto theft, more than doubling from the same period in 2023 due to a few large attacks and rising crypto prices, according to blockchain researchers TRM Labs and SlowMist.

By June 24, 2024, hackers had stolen over $1.38 billion worth of crypto, compared to $657 million in the same period in 2023, according to TRM Labs. The median crypto theft size was also 1.5 times larger than the previous year.

A report by blockchain security firm SlowMist, the first half of 2024 reported 223 blockchain security incidents, leading to $1.43 billion in losses, a 50% increase from H1 2023, with DeFi protocols being the primary targets. Ethereum suffered the highest losses at $400 million, followed by Arbitrum ($72.46 million) and Blast ($70 million). DeFi accounted for 70.85% of incidents with $659 million in losses.

Notable attacks included the DMM Bitcoin hack, resulting in the illegal transfer of 4,502.9 BTC ($305 million), and the PlayDapp incident, which involved unauthorized minting of tokens worth $290.4 million due to a leaked private key. Common attack methods included smart contract vulnerabilities, exit scams, and private key leaks, with emerging trends showing increased attacks on the Solana ecosystem and sophisticated phishing techniques like address poisoning and malicious browser extensions.

Globally, regulatory responses to cryptocurrencies varied, from support to strict prohibition. The US SEC approved spot Bitcoin ETFs and is considering an Ethereum ETF, with applications for a Solana ETF following soon after. In Europe, the EU Parliament passed laws to strengthen anti-money laundering measures, including public access to beneficial ownership registries and an EU-wide limit on cash payments. Turkey imposed strict regulations on crypto assets with severe penalties for unauthorized service providers. In Asia, Hong Kong introduced a comprehensive licensing system for virtual asset service providers and launched the first spot crypto ETFs in the region.

Efforts to combat illicit activities also intensified, with the US Treasury sanctioning entities involved in sanctions evasion through virtual assets. Tether and Circle froze millions in assets linked to suspicious activities by blocking hundreds of addresses.

The North Korean Lazarus Group remains a major threat, funneling substantial funds through Tornado Cash using sophisticated laundering techniques involving multi-layered mixing strategies, cross-chain swaps, and decentralized exchanges. Drainer services like Pink Drainer and Inferno Drainer also continued to pose risks, with Pink Drainer stealing over $85 million before its retirement. New threats, such as Diablo Drainer targeting the TON network, emerged.

Tornado Cash processed 263,881 ETH ($858.9 million) in deposits and 246,284 ETH ($796.2 million) in withdrawals in H1 2024. The eXch mixer saw increased activity, with ETH deposits rising to 71,457 from 47,235 in all of 2023, indicating growing usage by potential malicious actors.