In May, a report from blockchain security firm Beosin revealed a surprising trend in the crypto industry. Losses from “rug pull” or “exit scams,” where founders of a project abruptly vanish along with investors’ money, had surpassed the amount stolen from decentralized finance (DeFi) projects. A total of $45 million was lost due to rug pulls and scams across six incidents, while DeFi protocol attacks only accounted for $19.7 million over the course of ten attacks. This marks a nearly 80% decrease in losses from DeFi exploits since April.
Among these incidents, the most significant rug pull was the crypto project Fintoch, which allegedly made off with $32 million on May 24. The largest attack on a DeFi platform occurred last month, with $7.5 million stolen from the Jimbos protocol.
Beosin’s findings indicate that hackers and scammers are shifting targets from project parties to ordinary users. As a result, the firm recommends that crypto users raise their anti-fraud awareness, conduct due diligence before investing in a project, and learn how to better safeguard their cryptocurrencies. The report also advises against using shared or public charging devices for mobile phones, as these could be modified to inject malicious programs capable of compromising private keys.
In April, the United States Federal Bureau of Investigation (FBI) issued a similar warning suggesting that people should avoid using free charging stations found in places like airports. According to the FBI’s Denver office, “bad actors have figured out ways to use public USB ports to introduce malware and monitoring software onto devices.” Users should instead carry their chargers and USB cords for use in electrical outlets.
While it’s concerning to see the rise in losses due to rug pulls and exit scams, it should be noted that DeFi attacks have been on the decline for two months. This trend shows the effort being put into developing more secure DeFi platforms and protocols. However, increased vigilance is crucial for crypto users, as bad actors are always looking for new ways to exploit weaknesses in the system.
The crypto community’s efforts should be focused on both building secure platforms and increasing awareness about potential scams among users. With a balance between technology and education, the industry can continue to grow and thrive while minimizing threats to investors.
Source: Cointelegraph
