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The Crypto market witnessed 167 major security incidents resulting in losses of over $13.7 billion in 2022.
In early January, a large study “Global Web3 Security Report 2022 & Crypto Regulatory Compliance Research” published. It was created jointly by the companies Beosin, Buildler DAO, Legal DAO and Footprint Analytics. The study consists of an overview of the ten biggest security incidents of 2022 on Web3, global statistics on crypto crime, and various countries’ regulatory policies related to crypto. Plus, this document contains tips that will help protect yourself on Web3 and the author’s forecast for 2023.
According to research, in 2022 there were more than 167 major attacks on Web3. Total losses from all types of attacks were approximately $3.6 billion, 47.4% higher than in 2021 (approximately $2.44 billion). Most of the losses were due to attacks on cross-chain bridges — 12 incidents for a total loss of $1.89 billion. And most of the other attacks (113) were directed at the DeFi sector.
If we take into account all crypto-related crimes, including pyramid schemes, fraud, money laundering, attacks/exploits and others (without financial crimes), losses for 2022 amount to over $13.7 billion.
The report attributes the decline in global TVL in 2022 to those events. As we can see from the chart below, events like Beanstalk, Luna Crash, Harmony, Nomad, Tornado Cash Sanction, The Merge, Wintermute, BNB Chain, Mango Markets, FTX collapsed were all followed by a withdrawal of capital from the crypto market.
Next, this study presents a list of the ten biggest security incidents for 2022. We summarize this list, highlighting data on the type of attack and the amount of harm caused:
- Ronin Network (Loss: $624 Million; Type of Attack: Social engineering)
- BSC Token Hub (BNB Chain) (Loss: $560 Million; Type of Attack: Blockchain Vulnerability)
- FTX Hack (Loss: $440 Million; Attack Type: Suspected rugpull)
- Wormhole (Loss: $326 Million; Attack Type: Contract vulnerability — validation issue)
- Wanderer’s bridge (Loss: $190 Million; Attack Type: Contract vulnerability — validation issue)
- Beanstalk (Loss: $182 Million; Attack Type: Flashloan)
- Wintermute (Loss: $160 Million; Attack Type: Private key intrusion)
- Mango market (Loss: $116 Million; Type of Attack: Price manipulation)
- Elrond (Loss: $113 Million; Attack Type: VM Problem)
- Harmony (Loss: $100 Million; Attack Type: Private key intrusion)
As for the chains that fell victim to the attack, the number one loss went to the Ethereum blockchain with losses increasing to over $2.01 billion and 59 incidents. The second place was taken by BNB Chain, which lost about $0.8 billion, but excelled in the number of incidents — 72. The third place was held by the Solana blockchain with a loss of about $0.51 billion and 7 incidents.
In 2022, according to research, the rug will be pulled 243 times. The total amount of industrial damage due to rug pulling was approximately $425 million (excluding $440 million FTX incident)
Related: Over 117K Scam Tokens in 2022! New Solidus Lab Report
Regarding cryptocurrency regulation, in 2022, countries such as the United States, EU member states, Hong Kong SAR, Singapore, Japan, South Korea, Malaysia and the United Arab Emirates are actively participating in this legislative sphere. The study authors note that in 2023 the main trend in regulatory policy will be “systematization”.
“In 2022, crypto ‘bombs’ often exploded, accompanied by dramatic market declines that caused severe turmoil in the industry. 2023 will surely see a response from global regulators. A number of regulatory trends are already emerging in 2022. In our view, one of the overarching themes of global crypto regulatory developments in 2023 will likely be “systematization of the regulatory framework”. A large number of jurisdictions with thriving crypto industries (e.g. US, UK, Canada, etc.) have not developed a systematic regulatory framework. In these jurisdictions, there are a large number of regulations issued by various regulatory or law enforcement agencies, but this fragmentation has left many underlying legal concepts unresolved and made practice difficult. The good news is that we see a clear trend towards ‘systematization’ in 2022.”
The study authors also talk about what to expect in the security sector in 2023. They write that the global regulatory system will evolve, the entire infrastructure will be strengthened, stolen funds will be returned more frequently, more attacks will be blocked before they start, and users will be more be aware of basic safety rules.
In conclusion, we recommend that you familiarize yourself with the third chapter of this study, which describes a security guide for Web3 users. And we continue to observe.
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