Over $26.8 billion in crypto assets at risk as insurance infrastructure lags

Interest in addressing insurance issues in the crypto space has long been insufficient, as evident from the industry’s typical response to challenging problems. Insurance is arguably the most critical component of crypto today, and the industry urgently needs new metrics to demonstrate significant progress from the current state.

Think back to the last time the crypto space went two consecutive months without a protocol treasury being hacked—it never happened.

DeFi protocols and various smart contracts remain vulnerable to attacks, and trust is gradually eroding.

From January to May 2026 alone, over 50 incidents occurred, resulting in total losses exceeding $840 million—a 70% increase compared to the same period in 2025. If we extend the timeframe to the most recent data, this figure has surpassed $2.68 billion.

The issue is clear: the existing security infrastructure of on-chain financial systems is weak, leaving users vulnerable. But the hacks themselves are no longer as attention-grabbing—the industry seems to have normalized them. What truly matters is what happens afterward.

What about insurance?

On April 18, attackers drained 116,500 rsETH, worth approximately $292 million, through KelpDAO’s LayerZero bridge, making it one of the largest DeFi attacks this year.