In 2022, the global web3 space was valued at over $934 billion, making it a prime target for blackhat hackers. According to this ImmuneFi report, there were 168 instances of hacking or alleged fraud in the cryptocurrency industry in 2022, resulting in a total loss of $3,948,856,037. Of that sum, $3,773,906,837 was lost to hacks in 134 specific incidents and $174,949,200 was lost to fraud in 34 specific incidents. The top four projects affected were Ronin Network, BNB Chain, Wormhole, and FTX, which accounted for most of the losses.
While the total loss in 2022 was a 51.2% decrease from 2021, the five major exploits of the year still totaled $2,361,000,000, making up 59.8% of all losses. Hacks were the primary cause of losses, comprising 95.6% of the total, while frauds, scams, and rug pulls made up the remaining 4.4%. DeFi projects were the most targeted, with 80.5% of successful hacks targeting them, while CeFi projects made up the remaining 19.5%. BNB Chain and Ethereum were the most targeted chains, with 65 and 49 incidents, respectively.
In the first quarter of 2022, losses totaled $1,229,500,867, representing a 7.9x increase from the same period in 2021. Ronin Network and Wormhole were the most affected projects, with a total loss of $951,000,000. In the second quarter of 2022, losses totaled $670,698,280, representing a 1.5x increase from the same period in 2021. Beanstalk and Harmony Horizon were the most affected projects, with a total loss of $282,000,000. In the third quarter of 2022, losses totaled $438,324,902, representing a 62.9% decrease from the same period in 2021. Nomad Bridge and Wintermute were the most affected projects, with a total loss of $350,000,000. Finally, in the fourth quarter of 2022, losses totaled $1,620,138,807, representing a 119.2% increase from the same period in 2021. FTX and BNB Chain were the most affected projects, with a total loss of $1,220,000,000.
Out of the total losses in 2022, only $204,157,000 has been recovered across 12 specific instances, representing just 5.2% of the total. This highlights the importance of having insurance in the cryptocurrency industry, as it can provide financial protection in the event of a hack or fraud. InsurAce offers insurance policies to protect against such losses, providing peace of mind and security in an increasingly volatile industry. It is essential for companies and individuals in the cryptocurrency space to consider insurance to protect their assets and investments.