BeInCrypto and the top trends examine the significant events of 2022 for cryptocurrency frauds.
Recent research claims that hackers stole $4.3 billion in crypto during January and November 2022, an annual increase of almost 37% from 2021. Though the overall sum rose, 2022 saw the fewest individual transactions to cryptocurrency scams in the previous four years.
Recent Crypto Frauds
Like last year, cyberattacks and frauds involving cryptocurrencies primarily targeted DeFi protocols, exchange platforms, and blockchain bridges in 2022. In 2021, DeFi methods accounted for over 72% of the cryptocurrency stolen by hackers. However, DeFi flaws were used in 21% of all cryptocurrency hacks that year. Approximately 97% of all cryptocurrency stolen this year was obtained using DeFi techniques. A loss of $1.4 billion is projected to occur in 2022 due to breaches on cross-chain bridges.
Solidus Labs estimates that compared to 2021, there was a 20% rise in cryptocurrency scams in 2022, with a rug pulls becoming more common. Investors lost $2.8 billion in 2021 due to rug pulls, in which project developers abruptly take investment money. Over 188,000 occurrences occurred in 2022 on multiple blockchains, including BNB and Ethereum.
Solidus Labs reports that 12% of all BEP-20 coins were linked to fraud, with Binance’s BNB Chain experiencing the highest number of fraud attempts this year.
So-called pig butchering or romance schemes were one form of crypto fraud that has been more prevalent this year. In these situations, scammers will online seduce a victim and persuade them to occasionally invest in crypto, ultimately blocking them and stealing the money.
According to a Social Catfish survey, 35% of dating apps, 10% of Facebook, and other applications are the origin of romance scams. In 2021, people fell prey to these scams and lost approximately $139 million in crypto, and romance scams cost Americans $185 million in crypto in the first quarter of 2022.
Americans lost $329 million to cryptocurrency scams in Q1 2022, while Australians lost $166 million throughout the year. In addition, crypto fraud cost Hong Kong investors $50 million in 2022. In the meantime, North Korean-affiliated hackers have taken about $1 billion in crypto from DeFi protocols.
Major Cryptocurrency Scams Of The Year
Yet despite the rise in these crypto frauds this year, a much more reliable source suffered the highest loss. After the crypto exchange, FTX declared bankruptcy, and investigations showed that $1 to $2 billion of user assets were gone. It is now the biggest crypto scam carried out this year.
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However, the successive two significant losses resulted from the more conventional types of crypto fraud discussed above. From Axie Infinity’s Ronin Network in March, hackers stole almost $615 million USDC and Ethereum. Early February saw the third-largest loss when a hacker obtained nearly $325 million in Ethereum using the Wormhole protocol.