Crypto Rug Pulls Outshine DeFi Exploits as Leading Cause of Losses in May
Crypto Rug Pulls Outshine DeFi Exploits as Leading Cause of Losses in May
Cryptocurrency losses from rug pulls or exit scams, where founders leave with investors' money, have exceeded the amount stolen from decentralized finance (DeFi) hacks in May.
This spike in rug pulls emphasizes the ongoing challenges market participants needed to conquer in the crypto space.
In a report from Beosin, a blockchain security firm, total losses from rug pulls and scams went above $45.00 million across six incidents.
The largest rug pull came from the $32.00 million loss that the crypto project Fintoch allegedly made off last May 24.
The project, which is claimed to be backed by investment banking behemoth Morgan Stanley, promises a 1.00% daily interest for investments from users.
However, Fintoch users have reported that they are now unable to withdraw their funds from the platform.
On the other hand, there are recorded ten attacks on decentralized finance (DeFi) protocols that fetched only $19.70 million.
This amount reflected an 80.00% decline from the previous month, marking the second consecutive monthly plunge in these types of exploits.
Meanwhile, the biggest attack of the month was the $7.50 million hack on the DeFi platform Jimbo's protocol.
Accordingly, Beosin cautions everyone that hackers and scammers are now shifting their targets to ordinary users.
The security risk monitoring platform reminds investors to raise their anti-fraud awareness by undertaking due diligence on a venture before releasing their funds.
At the same time, the firm emphasized not to use shared or public charging devices for mobile phones as hackers could potentially modify the outlets to inject malicious programs that could compromise private keys.
The United States Federal Bureau of Investigation (FBI) issued the same warning last April, stating that the use of free charging stations such as at airports should be avoided.
