Crypto Hackers Running Riot, Industry Losing $216,000 Every Hour

Cryptocurrency is among the industries that has borne the brunt of cyber attacks, resulting in staggering losses of over $12 billion since 2011 and a whopping $1.89 billion this year alone.

Bitcoin, the world's first crypto and largest crypto asset by market capitalization, was invented by its pseudonymous creator Satoshi Nakamoto in 2008 and rolled out to the public in 2009. It means cybercriminals spent just a few years devising ingenious ways to attack, exploit and hack crypto businesses and accounts.

Since 2011, crypto hacks cost the industry $12.36 billion, 30.74% of which came from 192 cryptocurrency exchanges that cumulatively lost $3.8 billion to cybercriminals, data from a report by independent think tank The Money Mongers revealed.

The report highlighted that 297 crypto hacks were executed this year alone and underlined that the industry loses $216,000 every hour.

The Ronin Network hack in March last year, which lost around $625 million, still tops the list of the top 10 biggest crypto hacks.

Second on the list is the Poly Network attack, which lost approximately $610 million on Aug. 10, 2021, followed by the Binance Smart Chain hack on Oct. 6 last year, which lost 2,000,000 BNB worth $566 million at the time.

The Coincheck hack, which wiped out around $534 million in crypto assets on Jan. 26, 2018, landed on the fourth spot of the top 10 list, followed by the $473 million Mt. Gox hack in February 2014 and the $415 million FTX hack in November last year.

On the seventh spot are Wormhole's $326 million hack, Kucoin's $281 million exploit, Gate.io's $234 million hack and Euler Finance's $197 million hack.

The Money Mongers based its report on data collected from multiple sources including individual reports, news articles and information from third-party security firms. While the report includes exploits committed by malicious actors, it did not include exit scams, rug pulls, or theft committed by employees.

The team said that "the data only displays the total amount lost to hacks before any recovery attempt. So, the actual lost amount for certain entries may vary."

"The research findings, revealing a cumulative loss of $12.36 billion since 2011 and $1.89 billion in 2023 alone, underscore the urgent need for fortified security in the crypto domain," The Money Mongers CEO Sudhir Khatwani told International Business Times.

"As crypto matures as an asset class, its rising value has inevitably attracted more hacking attempts, especially targeting BTC & ETH," Khatwani added. "While the potential of cryptocurrencies remains vast, these security breaches erode public trust. It's imperative for the industry to prioritize robust security measures to safeguard both investors' assets and the integrity of the crypto ecosystem."

Interestingly, the crypto industry saw the highest amount of assets lost to hacks in 2022, amounting to $3.5 billion from 284 incidents, while 2018 was a particularly devastating year for centralized crypto exchange platforms which cumulatively lost $1.1 billion to hacks and thefts.

Chainalysis reported that 2022 was considered the worst year for crypto businesses as the industry suffered a $3.8 billion in losses from crypto hacking.

The blockchain analysis firm underlined that while there was rampant cybercriminal activity all of last year, malicious actors were particularly busy in March and October. It said October "became the biggest single month ever for cryptocurrency hacking, as $775.7 million was stolen in 32 separate attacks."

Last year also saw the notorious cybercriminal group Lazarus shatter its own records for theft as the North Korean government-backed actors stole a staggering $1.7 billion of crypto assets across multiple hacks attributed to its name.

This year, cybercriminals linked to North Korea have stolen approximately $200 million in crypto across 30 hacks, which is much lower than last year but still an amount that's "10 times larger than attacks by other actors," according to a report by blockchain analytics firm TRM Labs.

So far, 2023 has seen a considerably lower amount of cryptocurrencies lost to crypto hacks. This, however, is not due to a decrease malicious activity but because of the decrease in the value of crypto assets in the ongoing bear market.