The Worst Month for DeFi: $468 Million Lost in Hacks and Cyber Attacks

Greatest Losses on the Ethereum Network

The month of July has proven to be the worst for the decentralized finance (DeFi) sector in terms of losses. A total of $468 million was lost from DeFi protocols due to hacks and other cyber attacks. This performance is significantly worse compared to the same month in the previous year, where losses reached around $80 million.

Outline:

– Introduction: July as the worst month for DeFi with a significant increase in losses

– Comparison of losses between July of the current year and the previous year

The majority of the losses occurred within the Ethereum (ETH) network, accounting for over 95% of the total monthly losses. The hack of the cross-chain platform Multichain was the main contributor to these losses, with a total loss of $231 million in crypto assets. Additionally, the crypto payment provider Alphapo was hacked, resulting in a loss of approximately $100 million.

Outline:

– Introduction to the Ethereum network as a major player in the DeFi sector

– Details of the Multichain hack and the resulting loss

– Overview of the Alphapo hack and its impact on the DeFi sector

Access Issues Leading to Significant Losses

Surprisingly, Base, the new network launched by crypto exchange Coinbase, experienced a loss of $23 million. One notable event related to Base was the recent “rug pull” involving the BALD token, where early investors made millions in profit in a day, leaving many investors at a loss. More than 38 attacks were linked to rug pulls, resulting in a total loss of $36 million.

The majority of losses were attributed to access issues. In the context of crypto, access issues refer to problems with the setup of access rights and permissions within a blockchain or smart contract. These issues can arise from security flaws in access control, allowing unauthorized users to gain access to certain functions or data. A total of $364 million in crypto funds were hacked via this method.

Re-entrancy attacks accounted for a loss of $78 million. These attacks involve malicious smart contracts that invoke a function from another contract and then repeatedly call back to the malicious contract before the initial invocation is completed. This allows the attacker to repeatedly withdraw funds before the original contract updates the balance.

Outline:

– Introduction to access issues as a common cause of losses in the DeFi sector

– Explanation of access control vulnerabilities and their impact on security

– Description of re-entrancy attacks and how they exploit vulnerabilities within smart contracts