Web3 Attacks Continue Into 2023, But Figures Better Than 2022

Blockchain security firm Beosin disclosed that in the first quarter of 2023, it tracked and recorded a total of 61 attacks in the web3 space and 41 rug pulls.  

The overall loss from attacks in the Q1 2023 report was around $295 million, less than any of the 2022 quarters. The rug pull thefts resulted in a loss of almost $20.34 million.

March saw the Most Web3 Attacks in Q1

The report highlighted that the web3 attacks were the most frequent in March. The month saw a total loss of $235 million, which circles to 79.7% of all losses in Q1. For instance, a hack in March cost Poolz Finance almost $390,000 on the Polygon and Binance Smart Chain. Non-custodial DeFi protocol Euler Finance was also the target of a flash loan attack in the month, losing over $195 million.

Most defi attacks, according to previous data by DeFiLlama, use compromised private keys. BeInCrypto cited the report underlining that assaults in 2023 involve problems with protocol logic.

The report found that “Rug Pulls continue to occur frequently this quarter, with 56% of the exit scams involving amounts less than $100,000.”

In April, the South Korean cryptocurrency platform GDAC suffered a loss of at least $13 million due to a hot wallet hack. At the beginning of the month, $570,000 worth of crypto from cross-chain solutions vendor Allbridge was also stolen.

Beosin notes that DeFi attacks incurred the highest losses this past quarter. 42 DeFi security incidents resulted in a total loss of $248 million, the report stated.

Ethereum Biggest Target but BNB Vulnerable to Rug Pulls

 According to the blockchain security study, Ethereum was the most affected blockchain in terms of losses, accounting for 80.8% of all losses. The report noted, “In Q1 2023, there were 17 major attacks on Ethereum, resulting in total losses of approximately $238 million.”

Ethereum as a target is unsurprising, considering it is the second-biggest cryptocurrency by market cap and the largest network in terms of the total amount of money locked in defi.

According to the research, flash loans were the source of 67% of losses this quarter. According to the report, eight of these occurrences resulted in almost $198 million in losses.

The BNB Chain experienced the second most number of attacks with 31 exploits. Its overall losses came to $19.48 million. Notably, 34 projects (83%) of the total 41 rug pulls occurred on the BNB Chain.

Algorand came in third, mostly due to the MyAlgo wallet problem. Beosin noted the chain did not experience any significant security breaches last year. 

Meanwhile, Solana’s position among all blockchains in terms of losses has improved since 2022. Per the report, no significant security incidents were found this quarter on Solana.