menuIcon
$ 78,587.6
BTC
$ 78,587.6
0.19 %
$ 1,535.88
ETH
$ 1,535.88
-1.28 %
$ 0.5963
ADA
$ 0.5963
3.92 %
$ 560.18
BNB
$ 560.18
1.53 %
$ 107.69
SOL
$ 107.69
1.00 %
Gitumani Talukdar
Nov 20, 2021
by Gitumani Talukdar

Report: $10.5 Billion Lost to Theft and Fraud by Defi Users in 2021, Majority on Ethereum

Theft Fraud Defi Ethereum
$10.5 billion lost to theft and fraud by Defi users in 2021, Majority on Ethereum, risk management enterprise Elliptic comments, "Defi users have rendered $12 billion to drugs & scams over the last 24 months."

In 2020, Defi theft and fraud followed to $1.5 billion losses. Owing to the higher asset prices, this year, the figure shoots up to $10.5 billion. Hacks, raids, fraud schemes, etc. What's similar in these decentralized finance exploits? Someone at an after-party loses money.

$10.5 Billion lost to Theft and Fraud by Defi Users in 2021

Decentralized finance (Defi) introduces blockchain-based applications that avail users to avoid banks and other common financial negociants to bestow, borrow, save, or trade with peers employing self-executing smart contracts wired into protocols.

According to the survey conducted by Defi Llama, at present, Defi owns more than $250 billion in digital assets. Back then around June 2020, the statistics were less than $1 billion. Escalated use of protocols, prices emerging for the underlying coins and governance tokens have all together created an intact cycle for investments. The development of networks like Solana and Binance Smart Chain over Ethereum lead to the popularity of Defi.

Complications in several projects 

Elliptic runs through the complications in Defi projects. Its reports say, "many are start-ups with somewhat unsophisticated cybersecurity, and crypto's immutable feature makes it tough to recover these funds. This has led to the enticement of targets for attackers ranging from lone hackers to nation-states."

Sometimes cybersecurity's error is not accidental, rather the creation of "backdoors initiated by their creators to steal users' funds." Highlighting Elliptic observation, $2 billion has been reflected directly from decentralized applications in the last 2 years.

This figure imputes an additional $10 billion in losses thereby reducing token value owing to fraud or theft. The etiquette loss sets down consumer confidence in the product.

Follow us on: News
Ethereum Altcoins Decentralized Finance DeFi users DeFi theft
Report: $10.5 Billion Lost to Theft and Fraud by Defi Users in 2021, Majority on Ethereum
Gitumani Talukdar
Gitumani is a blockchain enthusiast as she keeps a tab on the recent happenings pertaining to the crypto industry. She aims to provide quality content in blockchain and crypto domain. She is a financial content writer too and has worked on several financial projects related to the stock market news, fundamental research, and technical analysis for several websites.

Top Picks