DeFi Hacks Down 40% in 2024
The DeFi space saw major milestones in 2024 as financial losses from security breaches fell by 40 percent compared to 2023. According to the latest annual “Web3 Security Report” published by Hacken, this decline was driven by enhanced cryptographic techniques, improved bridge protocols, and the use of multiparty computation.
This definitely shows that improved protocols are successfully securing the formerly weak points, as bridge-related exploits-a historical DeFi Achilles’ heel-saw losses drop from $338 million in 2023 to just $114 million in 2024. In contrast, access control vulnerabilities continue to represent nearly half of all DeFi-related losses, with notable incidents including the $55 million Radiant Capital hack.
But the space still needs to address some lingering security gaps, most especially related to governance mechanisms and permissioning systems.
CeFi Breaches Soar to $694 Million
While DeFi was improving, CeFi had a pretty bleak year in 2024. Financial losses reached $694 million, which is over double the amount seen in 2023. The year was also riddled with high-profile breaches, such as the DMM exchange hack, which resulted in $305 million in stolen funds, and the WazirX hack, which saw $230 million lost to attackers.
Most of them utilized certain systemic vulnerabilities, including stolen private keys, poorly set up multisignature processes, and flawed access controls. These were identified as critical gaps in operational security by Hacken’s report. According to Dyma Budorin, CEO of Hacken, one of the most important challenges is to improve private key management and security practices that can mitigate these risks.
CeFi relies on centralized infrastructures that have limited automation, making them highly susceptible to sophisticated attacks; thus, overhauling the existing frameworks is very important.
Lessons for the Crypto Industry
The contrast in progress between DeFi and CeFi sends one clear message: the crypto industry needs robust security measures if it is to be sustainable. According to Hacken’s report, stricter key management practices and automated monitoring systems could be implemented to close the security gaps that currently exist.
Reports from Chainalysis further amplify these concerns, revealing that North Korean hackers stole $1.3 billion across 47 incidents in 2024. The prevalence of such exploits emphasizes the need for proactive security measures industry-wide.
Conclusion
While DeFi demonstrates how innovation can bolster security, CeFi’s ongoing vulnerabilities highlight the dangers of complacency. Both sectors must prioritize security enhancements to safeguard user assets and maintain trust in the crypto ecosystem.
