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A recent report from blockchain security firm Beosin indicated that the total value of cryptocurrency assets lost to exit scams and rug pulls exceeded the amount taken from decentralized finance (DeFi) projects through exploits and attacks in the previous month.
Beosin also found that losses from exploits in May decreased by 79% compared to April, marking a sustained decline for two consecutive months.
Rug Pull Losses Exceed DeFi Exploits
In May, over $45 million was lost to crypto rug pulls across six incidents. The most significant exit scam involved the DeFi lending protocol Fintoch, which is suspected of operating as a Ponzi scheme, disappearing with 31.6 million USDT ($31.6 million) in user funds on May 24.
The second-largest rug pull involved the theft of approximately $5.9 million by Inferno Drainer, a multi-chain scam service provider, impacting around 5,000 victims. Another significant rug pull was carried out by the developers of the decentralized exchange (DEX) Swaprum on May 19, where the team drained $3 million in Ether (ETH) tokens from the protocol’s liquidity pools.
Conversely, DeFi exploits totaled $19.6 million in stolen crypto assets. The largest exploit targeted the Arbitrum-based liquidity protocol Jimbos, compromising over 4,000 ETH valued at about $7.5 million. Additionally, the Ethereum-based crypto mixer Tornado Cash was hacked for roughly $2 million.
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DeFi protocol Deus Finance, which has been the target of multiple attacks, was breached again on May 5 due to a public burn vulnerability in its stablecoin DEI (DEI). The attacker exploited the DEI token contracts on the BNB Smart Chain (BSC) and Arbitrum network, stealing more than $6 million.
Increasing Awareness of Fraud
The blockchain security company also observed a rise in security incidents related to hardware wallets in May. Beosin cautioned against a new method of coin theft that utilizes shared or public charging devices to install malicious software capable of stealing private keys.
“The amount involved in Rug Pulls exceeded that in attacks this month, and new methods of stealing coins, such as using shared chargers to obtain private keys, have also emerged. Hackers and scammers are progressively shifting their focus from various project parties to everyday users,” Beosin stated.
The firm encouraged users to enhance their anti-fraud awareness, familiarize themselves with various asset protection methods, and perform due diligence on projects prior to investing. The largest exit scam in May was executed by Fintoch, which absconded with user funds totaling $31.6 million.
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