Crypto losses drop to $452 million, report says

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Cryptocurrency losses from hacks and scams dropped $452 million in the first quarter of 2023, antivirus and app provider company De.Fi revealed.

In its latest report, titled Report: $452m Lost in Crypto in Q1 2023. New Trends of Hacks and Scams, the company said it was down 65.23% from 1.3 billion. dollars recorded during the corresponding period of the previous year.

The report states that crypto losses hit a nine-digit amount in March, for the second in a row. He said $215 million was lost in March alone.

The company noted that, of the $452 million lost in the first quarter, a total of $215 million was lost in the first 20 days of March alone, underscoring the rapid pace at which scammers have operated in recent weeks.

While these losses are staggering, they also mark a decrease from the same period in 2022, when $1.3 billion was lost in the first quarter.

He explained that the largest losses in the first quarter were due to flash loan issues, which had increased in recent months, with more than $200 million lost through the channel.

The company, which claimed to maintain the largest database of hacks, scams and exploits in the crypto verse, said the Ethereum chain was where the highest losses were recorded during the quarter.

In terms of recovery, $130 million was recovered in the first quarter of this year, marking a recovery rate of 28.7%.

In the corresponding period of 2022, $520 million, or 40% of the funds, has been recovered. Scammers mined new tokens to attract unsuspecting crypto investors in the first quarter.

The company said: In terms of attack vectors, tokens have proven to be the most popular targets this year so far, not surprising given that tokens are easy to deploy and attack to the fear of missing out experienced by many new crypto investors.

This is especially true with the return of the market in recent days. In terms of amounts lost, however, Lending and Borrowing Protocols won the prize, thanks to a small number of high profile Euler Finance and BonqDAO events.

Crypto investors that lost the most were Euler ($196m), BonqDAO ($120m), CoinDeal ($45m), Monkey Drainer ($16.5m) and Platypus Finance ($8.5 million).

De.Fi concluded by noting that the sharp increase in financial losses in the first quarter highlighted the need for increased risk management and vigilance when investing in the decentralized finance sector from investors. .

It is crucial for investors to educate themselves on potential dangers and implement appropriate measures to protect their investments, he added.

Crypto scams have been on the rise lately as crypto adoption continues to grow in many countries. Nigerians are one of the biggest users of crypto and are not isolated from these scams.

According to a report by Finder.com, 27% of Nigerian internet users own cryptocurrency assets.

A recent report by Chainalysis revealed that 24% of tokens created in 2022 were scams. Most of these scams were created on the principle of pump and dump, adding that the creators would hype and promote these tokens (crypto assets) to other investors, causing prices to rise as new investors would buy.

This would allow creators to sell their overvalued stocks for a profit, possibly driving prices down and leaving new investors stuck with low-value assets, the report said.

According to Chainalysis, investors spent $4.6 billion on this scam last year.

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