A new report from the crypto intelligence company CipherTrace shows that crime in the cryptocurrency space is on the decline, while the booming decentralized finance (DeFi) sector is ripe with hacks.
According to the firm, the amount of money lost due to crypto fraud, thefts, and hack attacks has reached $1.8 billion 10 months into 2020, which is significantly less than the $4.5 billion reported in 2019.
Meanwhile, the company tells Reuters that the total amount of money stolen in DeFi hacks stands at $98 million, up exponentially from a “virtually negligible” amount last year.
CipherTrace CEO Dave Jevans says centralized crypto exchanges are beefing up security, while the nascent DeFi market, which is made up of protocols offering peer-to-peer ways to lend and borrow assets as well as earn yield for providing liquidity, remains vulnerable.
“Companies and individuals have rushed DeFi products to market that have not gone through security verification and validation. So people are figuring out that there’s a weakness here.”
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