Report Shows More Crypto Assets Lost to Exit Scams and Rug Pulls Than DeFi Exploits

Report Shows More Crypto Assets Lost to Exit Scams and Rug Pulls Than DeFi Exploits

Blockchain security company Beosin has released a new report which shows that the total amount of crypto assets lost to exit scams and rug pulls is higher than the amount stolen from decentralized finance (DeFi) projects through exploits and attacks. The report also reveals that losses from DeFi exploits in May were 79% lower than that of April, indicating a continued decline for two consecutive months.

In May, over $45 million was lost to crypto rug pulls across six different incidents. The biggest exit scam was executed by DeFi lending protocol Fintoch, which is suspected of being a Ponzi scheme. Fintoch vanished with $31.6 million in users’ funds on May 24. Another rug pull worth mentioning was executed by the developers of decentralized exchange (DEX) Swaprum on May 19, where the team drained $3 million in Ether (ETH) tokens from the protocol’s liquidity pools.

On the other hand, DeFi exploits amounted to $19.6 million worth of stolen crypto assets. The largest exploit was the attack on Arbitrum-based liquidity protocol Jimbos, which compromised over 4,000 ETH worth about $7.5 million. Ethereum-based crypto mixer Tornado Cash was also hacked for roughly $2 million. DeFi protocol Deus Finance, which has fallen victim to many attacks, was hacked again on May 5 through a public burn vulnerability on its stablecoin DEI (DEI). The attacker exploited the DEI token contracts on the BNB Smart Chain (BSC) and Arbitrum network and made away with more than $6 million.

Hardware Wallet-Related Security Incidents Increase in May

Beosin’s report also notes that hardware wallet-related security incidents increased in May. The company warns against a new type of coin theft that uses shared or public charging devices to implant malicious programs that could steal private keys.

The report states that “Hackers and scammers are gradually shifting the target of their attacks from various project parties to ordinary users”. As a result, Beosin is urging users to raise their anti-fraud awareness, learn several methods for safeguarding their assets, and conduct due diligence on projects before investing in them.

Beosin’s report highlights the importance of users being vigilant when investing in cryptocurrencies. While DeFi projects can be vulnerable to attacks, rug pulls and exit scams can result in even more significant losses. Therefore, it is crucial to conduct thorough research and take necessary precautions before investing in any project involving cryptocurrencies.


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