WazirX requests court protection as cybersecurity losses surge to $2.1 billion in 2024

The cybersecurity landscape has seen some major hits throughout this year, leading to massive financial losses to various forms of attacks. By the end of the third quarter, the losses had climbed up to $2.11 billion, far surpassing the amount lost during the same period in 2023.

Losses Up To Q4 2024 Already Exceed Losses In Entire 2023

The increase in losses was likely caused due to a sharp surge in the number of hacking incidents. This signals the growing threat landscape that requires immediate attention, with major breaches of DMM Bitcoin and WazirX exchanges further stressing the necessity to react.

In fact, the situation is so critical that the losses seen by the end of Q3 2024 already exceed the total losses for the entire 2023. Between January and September last year, the total losses amounted to $1.23 billion, while total losses for the entire 2023 went up to $1.69 billion. 

This means that losses recorded between January and September 2024 saw a 72% increase compared to the first three quarters of the previous year. Furthermore, hacking incidents in centralized finance entities skyrocketed by almost 1,000%.

Wallet and custodian breaches also contributed to a surge by nearly doubling compared to the year before. Only losses from DeFi platforms saw and positive progress by decreasing by 25% compared to 2023.

This means that CEXes have seen a far more dramatic rise in hacking incidents throughout the year, with a 984% year-on-year increase when it comes to hacks. The surge is driven by multiple high-profile attacks, which were the worst in Q2 2024, resulting in $401 million in losses due to five major CEX attacks.

Most Of The Funds Were Stolen From DMM Bitcoin

The DMM Bitcoin exchange hack was responsible for the majority of this total, as the exchange lost $305 million to attackers. It is also one of the largest CEX breaches of the year. However, there were other platforms that saw smaller, but still considerably large breaches, including FixedFloat, BtcTurk, Rain Exchange, and Lykke.

The situation suggests that there is a major breach in vulnerabilities, and it requires increased access controls and regulatory oversight. This is why the Singapore court granted a four-month moratorium to India’s CEX WazirX, subject to specific conditions. 

The conditions include disclosing wallet addresses via a court affidavit, providing financial accounts within six wees, responding to questions from the users, and using independent platforms to conduct future votes.

WazirX itself suffered a $234 million loss a few months ago, in July, which affected 45% of customer funds. The exchange initially requested a six-month moratorium, but the judge noted that the exchange acted in good faith by requesting the moratorium in the first place.