Journalist
Posted:
- In 2023, DeFi losses from exploits amounted to approximately $1 billion.
- Total DeFi TVL increased to over $51 billion.
As the year draws to a close, a recent report has highlighted the achievements of decentralized finance [DeFi] room. The data in the message revealed the extent of losses from space exploits throughout the year.
Fewer DeFi losses recorded
According to a report from IntoTheBlock, 2023 is expected to record the lowest DeFi losses from exploits since 2020. This year, just over $1 billion has been lost to various exploits in the DeFi space.
While this figure still seems substantial, it pales significantly in comparison to the losses of the past two years.
The number of annual losses due to exploits in DeFi is expected to reach the lowest level since 2020! pic.twitter.com/abwfDFMEB8
— IntoTheBlock (@intotheblock) December 16, 2023
The data showed that more than $53.5 billion was lost to exploits in 2022 – the highest losses on record. In 2021, the loss was almost $4 billion, while 2020 saw the lowest loss: $157.2 million.
Some big Defi exploits of the year
Throughout the year, numerous DeFi hacks have resulted in the loss of millions of dollars, with notable incidents involving SushiSwap [SUSHI]Bonq and SafeMoon [SFM].
Around April 9, reports surfaced that SushiSwap fell victim to an exploit. The Decentralized Exchange (DEX) suffered a loss of more than $3.3 million for at least one user.
The exploit, which was caused by an approval-related bug in the RouterProcessor2 contract, caused a temporary drop in SUSHI’s price. However, prices normalized after the vulnerability was fixed.
Also, BonqDao suffered a significant smart contract exploit in February, leading to an estimated $120 million theft from the protocol.
The Bonq protocol fell prey to an Oracle hack that allowed the operator to manipulate the price of the AllianceBlock token (ALBT).
Similarly, SafeMoon encountered an exploit around March where the Safemoon token liquidity pool (LP) lost almost $9 million worth of tokens.
Attackers manipulated a faulty feature in the smart contracts and performed multiple token exchanges in a single transaction. This exploitation resulted in the theft of billions of Safemoon SFM tokens locked to an LP.
Like SUSHI, the SFM token saw a significant drop after the exploit.
How the DeFi TVL has done YTD
An analysis of the DeFi Total Value Locked (TVL). DeFiLlama showed a substantial decrease compared to previous years. The graph showed that the decline that started at the end of 2022 continued.
However, a slight upward trend became noticeable from October onwards and gradual growth has continued since then. At the time of writing, DeFi TVL was approximately $51.3 billion.
aWith the market showing signs of recovery, it remains to be seen whether the industry will continue to fend off DeFi attacks in the coming year.