Web3 Industry Hit by USD 656M Losses in H1 of 2023: Beosin Report
The Beosin Web3 report reveals that hacking alone accounted for a whopping USD 471 million in the first six months of 2023. The largest hacking of the year occurred at Euler Finance, with cybercriminals siphoning off a staggering USD 197 million. Contract vulnerability stood out as the most common type of attack, with losses amounting to USD 264.1 million. Most of the rug-pulling cases happened on the BNB Chain, and digital assets worth USD 53.4 million were lost during this period.
Hacking, Rug Pulls, and Phishing Scams Lead to Massive Losses
In the dynamic world of Web3, the first half of 2023 witnessed staggering losses amounting to USD 656 million, as disclosed by the comprehensive Beosin Web3 security report. Hackers, phishing scams, and the notorious rug pull played a major role in this unsettling trend. Hacking alone accounted for a whopping USD 471 million, constituting nearly 72% of the total losses. Phishing scams followed, contributing approximately 17% (USD 108.3 million) to the distressing figures. The remaining USD 75.87 million was attributed to rug pulls, reminiscent of the decentralized finance turmoil in 2021.
Notably, the largest breach of the year occurred at Euler Finance, where cybercriminals backed by North Korea siphoned off a staggering USD 197 million. Surprisingly, the Atomic Wallet attack, initially estimated at USD 35 million, turned out to be even more severe. The Web3 report reveals that a staggering USD 67 million was stolen, making it the second-largest incident in 2023. Among the top eight hacking incidents in H1 of 2023, cybercriminals made off with USD 25 million or less in each case, according to the report.
Comparing the losses to previous H1 periods, the data highlights that cybercriminals managed to pilfer more funds in the first six months of 2022, totaling around USD 1.9 billion. In 2021, the hacking losses were comparatively lower, at approximately USD 375.5 million.
Defi Projects Bear the Brunt of the Losses
The Web3 industry faced significant challenges in H1 of 2023, with decentralized finance (Defi) projects bearing the brunt of the losses. A total of 85 defi projects accounted for a substantial portion of the losses, reaching USD 292.6 million.
The report sheds light on the major vulnerabilities exploited by malicious actors. Contract vulnerability stood out as the most common attack type, responsible for losses amounting to USD 264.1 million. In addition, criminals employed tactics such as arbitrage attacks, private key compromises, and misconfiguration to further their illicit activities.
Most Rug Pulls Occur on the BNB Chain
Rug pulls, a thorny issue in the Web3 landscape, predominantly took place on the BNB Chain, accounting for the majority of incidents. Digital assets worth USD 53.4 million were lost during this period. However, the Ethereum blockchain also experienced a notable number of rug pulls, while the Dogecoin chain only suffered a single incident. Fontech emerged as the top rug-pulled project in the first half of 2023, losing over USD 30 million.
These disconcerting figures highlight the urgent need for enhanced security measures and heightened vigilance within the Web3 ecosystem. As the industry continues to evolve, it becomes crucial for stakeholders to prioritize cybersecurity and implement robust safeguards to protect digital assets and investor confidence.
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