A warning issued in the first quarter of 2023 reported that the amount of Crypto hacks is similar to the level seen in the second quarter of 2022. This was followed by a surge in the number of hacking incidents.
Crypto hacks experienced a significant decrease in Q1 2023. However, the crypto community should not lower their guard. The decline in the market is seen as a temporary relief rather than a long-term trend. This is similar to the level seen in the second quarter of 2022.
Crypto Hacks decreased from an all-time high for DeFi, reports TRM Labs
In 2022, crypto hacking reached its highest point in history, with an estimated $3.8 billion stolen, primarily targeting decentralised finance (DeFi) protocols. It involved attackers linked to North Korea.
However, the number of hacks has notably decreased in the first quarter of 2023.
TRM Labs reported on May 21 that the amount stolen through crypto hacks during Q1 2023 was lower than any other quarter in 2022. The report also highlighted that the average size of hacks dropped by nearly 65% compared to the previous year. An average of $10.5 million was stolen in Q1 2023. This is down from nearly $30 million in the same quarter of 2022, despite a similar number of incidents.
Despite the decrease, historical data suggests that crypto users should not become complacent. Crypto Hacks experienced a significant decline in Q3 2022, followed by a “record-setting number of hacks” in Q4. This made 2022 a record year for such incidents, as pointed out by TRM Labs.
Decline most likely a temporary reprieve
The report noted, “Unfortunately, this slowdown is most likely a temporary reprieve rather than a long-term trend.” He further added that a few large-scale attacks could easily tip the scales once again.
While no single clear explanation exists for the decrease in hacks, TRM Labs suggested that the sanctioning of cryptocurrency mixer Tornado Cash by the U.S. Treasury and the arrest and charges against Avraham Eisenberg, the exploiter of Mango Markets, may have deterred potential hackers.
In January, blockchain security firm Certik stated that it does not anticipate a decrease in exploits, flash loans, or exit scams.
TRM Labs also highlighted that hackers may target bridges in 2023. In 2022, these bridges were responsible for six out of the ten largest exploits, resulting in the theft of approximately $1.4 billion.