The cryptocurrency sector has faced record losses in 2024, with total losses exceeding $2.114 billion in the first three quarters. This figure surpasses the total annual losses of 1.69 billion recorded in 2023, as reported by Cyvers in a statement shared with BSCN. 

“2024 has already shattered records, with losses skyrocketing past the total for all of 2023,” Cyvers reported. 

This year's $2.114 billion loss represents a staggering 72% increase compared to 2023 during the same period, which had losses of $1.23 billion. 

CeFi vs. DeFi: A Growing Divide

Centralized Finance (CeFi) Incidents

Centralized exchanges (CeFi) have seen a dramatic rise in hacking incidents, with a nearly 1,000% year-on-year increase. Notable breaches in Q2 2024 contributed significantly to these figures. 

The DMM Bitcoin exchange experienced one of the largest breaches, resulting in a loss of approximately $305 million. Another Turkish exchange, BtcTurk, reported losses of $55 million, further emphasizing the vulnerabilities within CeFi platforms.

In total, centralized exchanges accounted for around $401 million in losses across five major incidents in Q2 alone. 

Decentralized Finance (DeFi) Trends

Despite the overall increase in crypto losses, DeFi platforms showed some resilience, with losses decreasing by 25% year-on-year in Q2 2024 compared to the previous year. 

However, DeFi still faced significant challenges, losing $171.3 million across 62 incidents. Ethereum and BNB Chain remained the primary targets for these exploits.

While DeFi incidents reflect a more stable ecosystem compared to CeFi, the complexity of smart contracts and decentralized systems continues to expose users to risks.

Vulnerability Breakdown

From January to September 2024, there were a total of 131 reported incidents. This represents 197% increase compared to the 44 incidents reported in the same timeframe in 2023. 

The breakdown of incidents includes:

• Smart Contract Exploits: 79 incidents
• Access Control Violations: 51 incidents

In the previous year, there were 28 smart contract exploits and 16 access control violations. Access control vulnerabilities have surged to $1.62 billion in 2024, a 99% increase from $742.6 million in the same period in 2023. 

In contrast, losses from smart contract vulnerabilities decreased by 19%, totaling $380.4 million this year compared to $429.6 million last year.

The surge in losses and incidents indicate the critical need for the cryptocurrency industry to enhance its security protocols. Cyvers stresses the importance of adopting real-time threat detection technologies and evolving regulatory frameworks.