Crypto losses due to hacking and fraud increased by 113% to $572 million in Q2 2024.

Crypto losses from hacking and fraud more than doubled in the second quarter of 2024 compared to the same period in 2024, according to a study conducted by blockchain security platform Eminefi.

More than $572 million was lost in Q2, compared to just $220 million in 2023. Centralized foreign exchange hacking accounted for the largest losses in the quarter.

Prior to the second quarter, losses from hacks and fraud were on the decline, with Immunefi reporting a 23% drop in Q1. This decline continued through April and most of May, but losses peaked in late May and June.

The biggest single loss during the second quarter was the private key hack of crypto exchange DMM on May 31, which removed $305 million worth of Bitcoin (BTC) from the exchange.

An additional $55 million was lost from the BtcTurk hack on June 22. These two major data breaches accounted for more than 62 percent of losses in the quarter, the report said.

Related: Japanese exchange DMM loses $305M in Bitcoin in private key hack

Centralized Protocols and Exchanges had a loss of nearly $401 million in the quarter, representing 70% of the total.

However, the number of successful attacks against these targets is a very small percentage of the total. Only five attacks were successful against centralized protocols, and there were a total of 62 successful exploits or spoofs involving decentralized protocols.

Decentralized financial protocols reported a loss of $171 million in the quarter, a 25 percent decrease from Q2 2023.

Ethereum and BNB Smart Chain continue to be the two main networks targeted by fraudsters and hackers, accounting for 71% of the total losses.

However, some evidence suggests that Ethereum Layer 2s may be gaining popularity among malicious people. Arbitrum was the third most targeted network, experiencing four crashes and losing 5.5% of the total. Blast and Optimism had three events each. All the other networks did not have more than one incident, which included a total of 15% of the total losses.

In the report, Eminefi founder Mitchell Amador said this quarter's loss is a sobering reminder of how important the security of central exchange infrastructure is:

“This quarter highlights how infrastructure transfers are the most devastating hacks in crypto, as a single compromise can cause millions in damages. This was evident this quarter, with hacks primarily targeting SeFi infrastructure, surpassing DeFi, the smallest number of hacks in the sector. Strong measures are essential to protect the entire ecosystem.

Some of the funds stolen in the second quarter were later recovered by security researchers. For example, an attacker who used the Gala Games protocol recovered almost all funds. Some reports suggest that the attacker connected a virtual private network to the wallet, exposing his IP address and possibly suing him, although this has never been confirmed.

Alex Labs, Blue and Yolo Games have also recovered most of the funds lost from their efforts, Immunefi said. The report said these refunds represent 5% of the lost revenue in the quarter.

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