Centralized Exchanges Taken Back by Hackers as Ransomware Payouts Increase in 2024: Chain Analysis

While overall illicit transactions have decreased since last year, there has been a notable increase in stolen funds and ransomware. The amount of funds stolen in crypto scams has almost doubled from $857 million to $1.58 billion at the end of July.

Ransomware payouts have also grown, with mid-year 2023 figures of $449.1 million compared to $459.8 million this year. This trend essentially pointed to the possibility of a record year for ransomware.

Criminals are once again focusing on centralized exchanges

By the end of July this year, the total value of stolen assets had exceeded $1.58 billion, an increase of 84.4% compared to the same period last year, according to the latest findings from Chainalysis shared with CryptoPotato.

Despite this significant increase in stolen value, the number of hacking incidents in 2024 has only slightly exceeded those in 2023, with a modest increase of 2.76% year-on-year. Meanwhile, the average committed value per incident has increased by 79.46%, from $5.9 million per event in the first half of 2023 to $10.6 million per event through 2024.

The blockchain data platform also said it appears that criminals are returning to their roots and targeting centralized exchanges again after four years of focusing on their decentralized counterparts.

After a spike in attacks on DeFi services and cross-chain bridges in 2022, attackers, including those from North Korea, are using advanced social engineering tactics, such as applying for IT jobs, to breach these exchanges. In fact, the UN has reported that more than 4,000 North Koreans are now working for Western technology companies.

Increase in ransomware attacks

Chainalysis has reported that ransoms paid have reached $459.8 million, making 2024 the worst year on record. According to Kiva Consulting General Counsel Andrew Davis, ransomware activity has remained fairly constant despite the disruptions caused by LockBit and ALPHV/BlackCat.

“Whether they are former affiliates of these well-known threat actor operations or new entrants, a large number of new ransomware groups have joined the fray, showing new methods and techniques to carry out their attacks, such as now the expansion of its initial means of access and the lateral movement is approaching.

Ransomware attacks are getting significantly worse, with a notable increase in larger ransom payments seen each year. In 2024, the highest single payout reached about $75 million to the Dark Angels ransomware group. This represented a year-on-year increase of 96% from 2023 and an impressive 335% increase from 2022.

Larger companies and key infrastructure providers are becoming prime targets for ransomware attacks, as their “deep pockets and systemic importance” make them more likely to accept large ransom payments.

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