Home Altcoins News Ethereum Bears the Brunt of 2024 Crypto Losses: 51% Tied to Its Ecosystem

Ethereum Bears the Brunt of 2024 Crypto Losses: 51% Tied to Its Ecosystem

Ethereum

The Ethereum blockchain has emerged as the primary target for cybercriminals in 2024, with the platform bearing the brunt of the year’s major losses in the cryptocurrency sector. A new report from Cyvers reveals that the Web3 ecosystem suffered over $6 billion in losses from hacks, exploits, and cyberattacks. Shockingly, Ethereum accounted for 51% of these losses, highlighting the vulnerabilities inherent in its decentralized finance (DeFi) infrastructure.

A Year of Increased Cyberattacks in Web3

The report paints a troubling picture of the rising number of attacks across the cryptocurrency space. In 2024, the Web3 ecosystem saw a 40% increase in losses compared to the previous year. Hackers targeted blockchain projects, exchanges, and DeFi platforms, with Ethereum being the hardest hit. This uptick in attacks demonstrates a growing sophistication among cybercriminals and signals a need for better security measures across the sector.

The year’s losses were broken down into quarterly figures: Q1 saw $517 million drained from various platforms, with Q2 slightly rising to $587 million. In Q3, the damage peaked at $669 million. However, Q4 experienced a sharp decrease, with only $130 million lost during that period. Despite the drop in losses in the final quarter, the overall figure for 2024 remained high, and experts warned that these losses could continue to rise if security breaches aren’t addressed.

Ethereum: A Prime Target for Hackers

Ethereum’s dominance in the DeFi space made it particularly vulnerable to cyberattacks. The platform’s large user base and high liquidity attracted hackers looking for profitable exploits. Ethereum’s role as a backbone for numerous decentralized applications (dApps) and smart contracts only increased its exposure. Hackers were able to take advantage of a range of vulnerabilities, from flaws in smart contracts to weaknesses in access control systems.

Though Ethereum took the biggest financial hit, other blockchains were also targeted by malicious actors. The Binance Smart Chain (BNB Chain) accounted for 24% of the overall losses, while other major networks like Bitcoin, XRP, and Arbitrum also experienced significant breaches. However, none of these platforms were hit as hard as Ethereum, which continued to face the most severe damage.

Access Control Vulnerabilities and Smart Contract Exploits

A major contributing factor to the losses in 2024 was access control failures. According to Cyvers, 81% of the stolen funds were due to lapses in authentication mechanisms and poor permission management. These vulnerabilities left users and platforms exposed to hackers who were able to gain unauthorized access to digital wallets and funds.

In addition to access control issues, smart contract exploits were responsible for the remaining 19% of stolen funds. Attackers used coding errors in smart contracts to manipulate decentralized applications, enabling them to siphon off assets from users’ wallets. These exploits showed the need for improved code audits and better security practices across the industry.

Notable Hacks in 2024

Several high-profile incidents made headlines in 2024, underscoring the vulnerability of cryptocurrency ecosystems. For instance, DMM Bitcoin experienced a $305 million hack, while PlayDapp lost $290 million in a separate breach. WazirX, a cryptocurrency exchange, also fell victim to a $235 million attack, while Radiant Capital had $55 million stolen from its platform. While some funds were recovered in the early months of 2024, recovery efforts diminished as the year progressed, with only $25 million being retrieved in Q4.

The Road Ahead for Ethereum and Web3 Security

The increasing frequency and scale of cyberattacks on Ethereum and other blockchain networks point to a growing need for robust security protocols. The evolution of hacking techniques combined with the growing complexity of Web3 technologies demands greater attention to cybersecurity. Ethereum’s prominent role in DeFi makes it an attractive target, but the broader crypto space must improve security to ensure the long-term stability and trust of decentralized financial systems.

Read more about:
Share on

Julie J

Julie is a renowned crypto journalist with a passion for uncovering the latest trends in blockchain and cryptocurrency. With over a decade of experience, she has become a trusted voice in the industry, providing insightful analysis and in-depth reporting on groundbreaking developments. Julie's work has been featured in leading publications, solidifying her reputation as a leading expert in the field.

Crypto newsletter

Get the latest Crypto & Blockchain News in your inbox.

By clicking Subscribe, you agree to our Privacy Policy.

Get the latest updates from our Telegram channel.

Telegram Icon Join Now ×