The Web3 sector has faced a turbulent third quarter in 2024, incurring substantial financial losses attributed to a wave of cyber attacks, phishing schemes, and rug pulls. As reported by PANews, the sector saw total losses reach approximately $730 million by September 25. Key incidents included 23 significant attacks, which alone accounted for about $430 million, alongside three rug pulls totaling around $4.24 million, and phishing scams that contributed roughly $295 million in losses.

Centralized exchanges (CEX) were particularly hard-hit, suffering losses of around $297 million from three major attacks, which represents 40.6% of all attack-related losses. Ethereum emerged as the most targeted blockchain, facing 21 separate incidents that resulted in losses of $348 million, or 47.6% of the overall total. The most prevalent method of attack involved private key leaks, with five incidents leading to losses of $305 million—41.7% of the total attack-related losses. Alarmingly, only about $16.9 million of the stolen funds have been frozen or recovered, leaving around 78.9% still unaccounted for in the attackers’ wallets.

In comparison to Q3 2023, which saw losses of $889 million, the recent figures reflect a slight decline. This reduction can be partially attributed to falling cryptocurrency prices. Nevertheless, the security landscape in the Web3 space remains precarious, with 18 of the 20+ attacks in the quarter linked to vulnerabilities in smart contracts. Experts advise that project teams prioritize comprehensive security audits prior to launching their initiatives to mitigate these risks.