In the first six months of 2022, Web3 projects have lost more than $2 billion to hacks and exploits — more than all of 2021 combined.
This new web standard that is linked to crypto currency and NFTs is quickly losing steam as its ‘secure platforms’ seem to be targeted by hackers time and again. That’s according to research from blockchain auditing and security company CertiK, which on Thursday released its quarterly Web3 security report covering Q2 of this year. The report paints a sobering picture of a cryptocurrency space still plagued by hacks, scams, and phishing schemes while also facing relatively new threats like flash loan attacks.
CertiK puts particular focus on this last category of threat, which has been created by the invention of flash loans: a decentralized finance mechanism that lets borrowers access extremely large amounts of cryptocurrency for very short periods of time. If used maliciously, flash loans can be used to manipulate the value of a certain token on exchanges or buy up all of the governance tokens in a project and vote to withdraw all of the funds, as happened to Beanstalk in April.
In total, CertiK’s report claims that a total of $308 million was lost across 27 flash loan attacks in Q2 2022 — an enormous increase compared to just $14 million lost to flash loans in Q1.