Immunefi: 80% of Hacked Protocols Die as ‘Managerial Paralysis’ Eclipses Theft
Immunefi CEO Mitchell Amador reveals that four out of five hacked projects collapse due to operational paralysis, not insolvency, as 2025 losses hit $3.4 billion.
Nearly 80% of crypto protocols struck by a major exploit never recover, according to Mitchell Amador, CEO of Web3 security firm Immunefi. The grim statistic, released this week, points to a crisis of leadership rather than solvency: the fatal blow isn’t the stolen funds, but the “managerial chaos” and immediate loss of trust that follows.
The $3.4 Billion Wake-Up Call
The warning comes as confirmed on-chain data pegs 2025 illicit losses at $3.4 billion, a three-year high driven by fewer, deadlier strikes. The metric was heavily skewed by the $1.46 billion compromise of Bybit in February, which accounted for nearly half of the year’s total carnage.
While liquidity can often be replenished, user confidence cannot. Amador noted that the “first few hours” determine a protocol’s survival, yet most teams freeze. Without a pre-signed crisis response, developers waste critical blocks debating PR strategy while attackers drain remaining pools.
“The collapse is primarily attributed to managerial chaos and loss of trust, rather than the direct loss of funds. Projects often avoid pausing smart contracts out of fear of reputational damage… silence only heightens panic.”
AI-Scaled Social Engineering
The vector of attack has shifted. Smart contract logic is hardening, so attackers are targeting the humans managing them. Immunefi’s data highlights a surge in AI-driven social engineering, where Lazarus Group-linked actors now generate thousands of context-aware phishing messages daily. These campaigns bypass audits entirely, exploiting credential management rather than code, a trend validated by the multi-sig compromise that facilitated the Bybit drainage.
Outlook: 2026
The sector is entering 2026 with stronger audit tooling, but the human layer remains the single point of failure. Protocols without a “break-glass” operational plan, automated pauses, pre-drafted comms, and war-gamed scenarios, are statistically likely to join the 80% graveyard.
