Here comes Friday, October 6th. As the week comes to an end we can focus on the highlights of the crypto industry over the past few days.
Crypto industry suffers 60% higher losses due to hacks and scams in 2023
In the Q3 2023, Web3 ecosystem saw $685.5m worth of losses stemming from hacks and fraud – that’s a 59.9% spike compared to the same period a year earlier, Immunefi calculated.
Year over year, the incident rate skyrocketed by 153%, from 30 to 76 incidents.
Out of total reported damages for the quarter, $662.85m attribute to 49 cyberattacks and $22.7m – to 27 scam instances.
The two major incidents, the Mixin Network ($200m) and Multichain ($126m) exploits, made up nearly half of the combined losses.
North Korean hacker group Lazarus is said to be responsible for stealing $208.6m in the ongoing quarter – representing 30% of the total loss, according to the report. Immunefi experts trace the hacks of CoinEx, Alphapo, Stake and Coinspaid to the hackers in question.
The bounty platform analysts noted that DeFi projects remain the focal point of hackers. These contributed 72.9% ($499.8m) of losses for the Q3 versus 27.1% of centralized services ($185.7m).
Looking at a breakdown in terms of networks, the Ethereum (35) and BNB Chain (25) ecosystems saw the largest number of such incidents. Since its public launch in early August, four projects based on the L2 protocol dubbed Base were subject to exploits.
As many as 8.9 percent of total losses were reclaimed by victims of the attacks in the third quarter, according to experts. Six incidents resulted in $61.2m in refunds.
As you may remember, Beosin estimated $889.3m in overall quarterly losses due to hacks and frauds.
El Salvador kicks off its very own Bitcoin mining pool
El Salvador’s mining project Volcano Energy has teamed up with Luxor Technology to launch the country’s pioneering BTC mining pool called Lava Pool, Cointelegraph reports.
As part of the public-private partnership, the entity has promised to allocate 23% of net income to the government. Proceeds will be invested in energy infrastructure to support economic growth.
Lava Pool will utilize Luxor’s mining software and the company’s hedging strategies to shield customers from the risks of market volatility.
Back in June, Salvadoran authorities unveiled a project to mine the alpha cryptocurrency using renewable energy.
Tether, the issuer of the USDT stablecoin, took part in Volcano Energy’s first $1 billion funding round. The company acts not just as an investor, but also as an advisor.
Initially, the facility is expected to have a power consumption of 241 MW and a hash rate of 1.3 EH/s.
“Our vision is to create a vertically integrated energy and bitcoin mining company whose value is accretive to investors and to all Salvadoran citizens,” said Volcano Energy Chief Strategy Officer Gerson Martinez.
Notably, in September 2021, El Salvador was the world’s first country to legalize digital gold as a legal tender.
State-owned LaGeo began experimenting with BTC mining using geothermal volcanic energy in October that same year.
MEXC backs TON’s evolution into a Web3 super-app
Team behind blockchain platform TON has raised an “eight-figure sum” of investment from the venture arm of crypto exchange MEXC. The partners will set about lowering the worldwide Web3 entry threshold, Cointelegraph says.
With this deal, MEXC looks to focus on promoting trending blockchain-based projects. The firm also intends to launch a lending service in TON and waive trading fees for using the partner’s utility tokens.
On top of ongoing support for TON-based projects, the venture arm will carry on funding related dApps such as Megaton Finance, TONPlay, Fanzee and Sonet.
Business partners engage in discussions about potential funding for a crypto wallet for Telegram.
Record $7b in crypto laundered through cross-chain solutions, Elliptic says
During the year of 2023, the total volume of illicit crypto assets stolen via cross-chain transactions hit a whopping $7 bln, as stated in a report by Elliptic.
This criminal activity was classified by analysts into three categories as follows:
- Decentralized exchanges (DEXs) that permit the exchange of crypto (as well as within a single blockchain);
- Cross-chain bridges that enable coins to move between networks;
- Crypto exchanges that fail to comply with KYC regulations.
Elliptic experts calculated $4.1b in assets laundered with the help of these methods in its first State of Cross-chain Crime report, published in October 2022. Moreover, they projected the figure to be $6.5b by late 2023.
“However, our latest $7 billion estimate illustrates that cross-chain crime appears to be escalating at a faster rate than predicted,” the analysts pointed out.
Over the course of the past 12 months, through decentralized exchanges alone criminals netted $3.9b as of July 2023 data. The figure jumped 82% in comparison to the previous reporting period.
From a perspective of assets origin, cross-chain crimes number grew significantly in the Ponzi schemes and in terms of overall volume of thefts.
The previously mentioned Lazarus affiliations accounted for $900m of funds laundered – which is roughly one-seventh of the total amount.
It should be noted that between January and August, the Web3 industry suffered dramatic loss of $1.25b due to the fraudulent actions of hackers and scammers, according to the figures provided by Immunefi analysts.