November 2, 2023

Crypto Industry Lost $32.2 Mln in October, Report Says

Crypto Scams

Crypto Scams

CertiK, a blockchain analysis firm, reported that crypto scams and security incidents resulted in a loss of over $32.2 million in October. The leading causes of loss were vulnerabilities, exit scams, and flash loan manipulations.

In just one month, user funds worth over $32.2 million were lost due to security incidents and scams in the cryptocurrency market, as per CertiK’s blockchain analysis.

Vulnerability exploits were responsible for a significant portion of this loss, totaling $22 million. The most significant incident was the security breach at the Fantom Foundation. Hackers stole $700,000 in funds, primarily from an employee’s wallet. Today, the hacker transferred the stolen funds to Tornado Cash.

In October, $8 million of the lost funds were due to exit scams and rug pulls. Standard Cross Finance carried out the largest exit scam of the month. The scam started as a gaming project that hired actors to pose as developers and executives, who went on to steal $1.6 million from investors.

The individuals behind this scam were reportedly involved in the Fontoch scam earlier this year, which took $31.6 million from investors and users.

Flash loan scams have caused a loss of $1.7 million this month. In these fraudulent schemes, attackers take advantage of flash loans, which allow borrowing and repayment to occur in a single transaction. The attackers use these loans to manipulate asset prices or exploit smart contract vulnerabilities, often resulting in financial losses for platforms or users.

The biggest flash loan scam this month occurred in Platypus DeFi, resulting in a loss of $2.2 million. However, more than 80% of the funds were eventually returned.

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