The cryptocurrency industry witnessed a significant reduction in losses during the second quarter of 2023, with losses amounting to $204.3 million, down by 50% compared to the previous quarter. However, the task of tracking and recovering lost funds has become increasingly difficult as hackers and scammers employ more sophisticated methods. This leaves us with the question, “is crypto dead?” Let’s explore it in this article!
A recent report by De. Fi, a web3 “super app” and antivirus solution, in collaboration with the REKT database, revealed that only $4.9 million was successfully recovered out of the total losses incurred. This figure marks a decline from the $6.9 million recovered in the same period last year. Despite the challenges, the industry’s losses were significantly narrower than the staggering $462.3 million lost in Q1 2023, with the Euler Finance flash loan attack being responsible for 42.4% of the losses during that quarter.
The report also highlighted that the industry has managed to recover approximately $183 million so far this year, representing nearly 28% of the total $666.5 million lost to scams and hacks.
Concerns over Crypto De-banking Raised by Australia Treasury
The Australian government has recognized the risks associated with the increasing trend of cutting banking services to cryptocurrency exchanges, as several banks restrict specific services due to scam-related concerns. However, the Treasury has warned that such actions could have unintended consequences, potentially reducing transparency within the industry.
On June 28, the Australian Treasury released an official statement addressing potential policy responses to de-banking practices in the country. De-banking occurs when banks refuse services to customers citing various reasons such as Anti-Money Laundering compliance, sanctions, and reputational risks. The statement emphasized the need for insightful data to monitor and respond to debunking issues effectively.
The Treasury’s move to protect the local crypto industry follows recent actions by major banks. In early June, CBA, the largest Australian bank, announced restrictions on certain payments to crypto exchanges due to scam risks. Similarly, Westpac previously banned its customers from transacting with Binance, a popular crypto exchange, in mid-May.
These developments took place during the Blockchain Australia event, a significant conference dedicated to blockchain and cryptocurrencies. Executives from all “Big Four” banks in Australia participated in a panel discussion, providing insights into their decision to limit services to crypto exchanges.