Chainalysis: Scams Down 65%, DeFi Attacks Still Rising

Chainalysis: Scams Down 65%, DeFi Attacks Still Rising

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2022-08-19 20:40:43

According to Chainalysis, despite billions of dollars stolen from hacks, cryptocurrency scams are “bottoming out.”

Chainalysis: scams down 65%, DeFi attacks are still “waking up”. Image source: Fortune

Based on a blockchain analysis report published by Chainalysis yesterday, from the beginning of the year to July, the volume of illegal crypto transactions has been lower than last year. The number of victims of cryptocurrency scams has “bottomed out”, but DeFi attacks are still on the rise again.

Frauds have siphoned off the market by $1.6 billion this year, 65% less than the same period in 2021. Fraudulent transfers also hit a four-year low. However, the report found that fraudulent revenue was fueled by more sophisticated schemes.

“Those numbers show that fewer people than ever are falling victim to crypto fraud activities. This is also considered understandable because the market is experiencing a lot of volatility. As a result, cryptocurrency scams – passive investment opportunities with huge promises of returns – often become less attractive to potential victims.”

Crypto scam revenue from 2019 to present. Source: Chainalysis

But if you go into each crime segment, you will see that the number of stolen assets related to blockchain bridges accounts for 69% of the total.damage. As has been repeatedly reported and warned by CHK, blockchain bridge mining is happening at an astonishing rate.

This is a powerful weapon often chosen by criminals to “take action” in 2022. Blockchain bridge is an increasingly important link, allowing the transfer and use of assets between ecosystems, help users eliminate many limitations such as reducing costs, increasing transaction speed … Therefore, this is where the bad guys often hang out.

Since the beginning of the year, there have been numerous incidents reflecting the weak security system, raising concerns around the safety of the blockchain bridge. For example, the hack Ronin ($622 million), Wormhole ($325 million), Horizon ($100 million), Nomad ($176 million).

Chainalysis warns:

“Also, we should not expect theft to decrease based on crypto market movements – as long as crypto assets remain in DeFi protocol pools and valuable services. ruling and other vulnerable, the bad guys will still be able to steal them. The only way to prevent it is to increase security and educate users on how to find safe investments.”

To fix bridge-related problems, some experts suggest that smart contracts should be thoroughly checked, to prevent hackers, as well as launch Bug Bounty programs that encourage gambling. Expansion price on project source code. There have also been calls for easing control of blockchain bridges developed by individual companies, as this could promote resiliency and transparency for trading codes.

Founded in 2014, Chainalysis specializes in providing software tools for government agencies, financial institutions, and businesses to detect and prevent cryptocurrency crimes.

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