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DeFi insurance claims amounted to $34.4 million in 2022: Report

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DeFi insurance claims amounted to $34.4 million in 2022: Report

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  • Analytics firm OpenCover’s report revealed that DeFi insurance companies paid out $34.4 million in claims in 2022.
  • As per a previous LianAn Technology report, DeFi exploits across blockchains worldwide totaled $3.64 billion.

Decentralized finance (DeFi) analytics firm OpenCover released a report on 22 March, revealing that DeFi insurance companies paid out $34.4 million in claims in 2022.

Notable DeFi claims in 2022 include $22.5 million from the Terra [USDT] ecosystem’s demise in May and $4.7 million from the demise of crypto exchange FTX in November.

In context, since OpenCover began tracking the data, insurance companies have only paid out $36.9 million in claims.

Despite the increase in payouts, only $231 million in funds in DeFi protocols had been insured, representing only 0.5% of the total value locked in the industry, the report mentions.

DeFi insurance has grown to include eight major categories: protocol loss coverage, stablecoin de-peg coverage, yield token coverage, custodial account coverage, audit (smart contract bug) coverage, slashing coverage for professional validators, and other customized coverage.

The report mentioned:

“At the time of writing, the total value of underwriting capital pools tracked by OpenCover amounts to $286 million (186k ETH) with a low of $210 million and high of $394 million in the last 9 months. The current value is 26% lower than the period maximum in USD terms.”

Source: OpenCover

Source: OpenCover

DeFi exploits totaled $3.64 billion in 2022

As per a January report published by the Chinese blockchain security firm LianAn Technology, DeFi exploits across blockchains worldwide totaled $3.64 billion in 2022. This represented a 47.4% surge over the $2.44 billion loss in 2021. Despite an 80% drop in total value locked (TVL) during 2022, the number of incidents increased. The majority of exploits were directed at Ethereum [ETH], BNB Chain [BNB], and Solana [SOL].

In 2022, 51.5% of the 167 notable incidents occurred in audited projects, while 48.5% occurred in non-audited projects. Hackers laundered Tornado Cash worth $1.40 billion in funds. However, the firm could only recover $289 million in funds.

In 2022, the total global blockchain-related crime, excluding financial crimes, amounted to $13.7 billion. Money laundering ($7.33 billion) topped the list, followed by DeFi exploits ($3.6 billion), multilevel marketing scams ($1.0 billion), and fraud ($830 million).

Source: LianAn Technology; Footprint Analytics

Source: LianAn Technology; Footprint Analytics

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Saman Waris works as a News Editor at AMBCrypto. She has always been fascinated by how the tides of finance and technology shape communities across demographics. Cryptocurrencies are of particular interest to Saman, with much of her writing centered around understanding how ideas like Momentum and Greater Fool theories apply to altcoins, specifically, memecoins. A graduate in history, Saman worked the sports beat before diving into crypto. Prior to joining AMBCrypto 2 years ago, Saman was a News Editor at Sportskeeda. This was preceded by her stint as Editor-in-Chief at EssentiallySports.
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