Hacking incidents are considered one of the biggest obstacles to the widespread adoption of digital currencies. Some prominent thefts have occurred across various exchanges and cryptocurrency platforms, causing investors to hesitate in placing their funds there.
It has been discussed that decentralized technology projects are safe, but the attacks that have taken place over the years have shown that this is only partially true. More than $3.8 billion in cryptocurrency was stolen from users in 2022, according to a blockchain data platform.
Ronin Network: $625 Million
The largest cryptocurrency hack to date occurred in March 2022 and targeted the network supporting the popular gaming platform Axie Infinity. Hackers breached the Ronin network and stole approximately $625 million in Ethereum and USDC stablecoin. U.S. officials stated that a hacker group linked to North Korea, known as the Lazarus Group, was associated with the theft. Binance recovered $5.8 million of the stolen funds a month later, but it remains the largest hack in history as of December 2, 2023.
Poly Network: $611 Million
In August 2021, hackers attacked the Poly decentralized finance platform and stole over $600 million. The project’s developers issued a plea on Twitter for the return of the stolen funds, which included $33 million in Tether. Poly created a network of multiple addresses to get the funds back, and the unidentified hackers began to cooperate. Within just two days, approximately $300 million was recovered, and it turned out that the hackers targeted the network “for fun” or as a challenge.
FTX: $600 Million
In November 2022, FTX, one of the most influential players in the cryptocurrency industry, announced its bankruptcy. On the day it filed for Chapter 11 bankruptcy, over $600 million was stolen from its digital wallets. Many FTX wallet holders reported a balance of $0 in their FTX.com and FTX US wallets. The cryptocurrency exchange confirmed the hack on its Telegram channel, stating: “FTX has been hacked. FTX apps are malware. Delete them. The chat is open. Do not visit the FTX site as trojans may be downloaded.” Ryan Miller, FTX’s general counsel, later tweeted that the cryptocurrency exchange was making “every possible effort to secure all assets, wherever they are.”
Binance BNB Bridge: $586 Million
In one of the largest attacks in cryptocurrency history, Binance exchange was hacked for $570 million in October 2022. The hackers exploited a bridge across side chains, the BSC Token Hub, where they created and withdrew 2 million additional Binance Coins (BNB). The hackers were able to exploit a flaw in a smart contract, highlighting the need to enhance blockchain security.
Coincheck: $534 Million
In January 2018, the Japanese exchange Coincheck was hacked for 523 million NEM coins, valued at approximately $534 million. A vulnerability was created via a hot wallet, which is a live cryptocurrency wallet and not as secure as a cold storage wallet. At that time, the Coincheck theft was larger than the notorious Mt. Gox heist; Lon Wong, chairman of the NEM foundation, described that time as “the biggest theft in history.” Coincheck managed to survive the hack and continued operations, albeit it was acquired a few months later by Japanese financial services company Monex Group.
Mt. Gox: $473 Million
The first major cryptocurrency hack occurred in 2011 when the Mt. Gox exchange lost 25,000 bitcoins valued at approximately $400,000. At that time, the cryptocurrency exchange was handling nearly 70% of all bitcoin transactions.
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The attack stops, and Mt. Gox faced another attack in 2014. It lost nearly 650,000 bitcoins belonging to its customers and about 100,000 bitcoins of its own. At that time, it represented 7% of the total bitcoin and was worth approximately $473 million. The initial reasons for the disappearance of the coins weren’t clear, but later evidence showed that the coins were stolen from the company’s hot wallet.
Wormhole: $325 million
The decentralized finance platform Wormhole was targeted in February 2022, with $325 million stolen by hackers. The attack was enabled by an upgrade to the project’s GitHub repository, which had not been implemented in the live project. The famous cryptocurrency bridge had to patch the vulnerability in project funding after failing to recover the funds. This was also the largest theft involving Solana, one of the competitors for Ethereum’s dominance in the DeFi and NFTs spaces. Up to $47 million was stolen in the blockchain’s native SOL coins.
Euler Finance: $197 million
Euler Finance is a lending and borrowing platform based on the Ethereum blockchain. On March 13, 2023, hackers executed a flash loan attack, seizing $197 million worth of wrapped bitcoin (wBTC), DAI (a stablecoin from MakerDAO), staked ether (stETH), and USDC. A flash loan attack occurs when hackers use a flash loan—a loan without collateral that must be paid back in the same transaction, often used by traders to manipulate prices. However, in a strange turn of events, the hackers began to return the stolen funds gradually after several days, citing concerns for their safety.
BitMart: $196 million
In December 2021, the centralized exchange BitMart was hacked, resulting in losses of up to $196 million. A security analytics firm detected the attack, observing that the balances of BitMart addresses were being drained. About $100 million worth of various cryptocurrencies was funneled through Ethereum, with an additional $96 million being withdrawn via the Binance Smart Chain. All tokens were sent to an address described by Etherscan as “BitMart Hackers.”
Nomad Bridge: $190 million
Just a month before the Wintermute hack, Nomad Bridge experienced a larger breach, where hackers seized $190 million of the project’s funds. Nomad is a cryptocurrency bridge that allows users to exchange tokens across blockchains, but it became a target for hackers due to the significant value of the assets they hold and the complexity of the smart contract code they operate on. Nomad later recovered $36 million of the stolen funds.
Beanstalk: $182 million
This breach involved exploiting a decentralized finance platform using a flash loan. After borrowing $1 billion, hackers seized a 67% controlling stake in the project and agreed to transfer the funds to their wallet before repaying the loan and disappearing. The entire process took just 13 seconds.
Wintermute: $162 million
Wintermute, a leading cryptocurrency trading firm, was attacked in September 2022. The project lost around $160 million in the hack, worsening matters for Wintermute as it owed $200 million to other market parties. The CEO offered a 10% bounty to the hackers if they returned the funds.
Multichain: $125 million
Multichain claimed to be a multi-chain routing protocol, which theoretically enables nearly all blockchains to communicate with each other and transfer assets between them—crucial for the continued advancement of web 3. The CEO of Multichain, known as Zhaojun, was detained in China and disappeared, leading analysts to believe that the theft was a result of a rug pull, where system owners/developers create a product, attract funds, and suddenly leave with the money.
How
Do hackers steal cryptocurrencies from cryptocurrency exchanges?
Most cryptocurrency thefts occur due to breaches of various credentials, such as the theft of user passwords or private keys. In some cases, hackers may even use phishing, keyloggers, or SIM swapping to gain access to a user’s account. In larger attacks, hackers may directly target the exchange by exploiting vulnerabilities in security protocols or trading software.
How do you protect cryptocurrencies from hackers?
The most important rule for storing Bitcoin or other cryptocurrencies is to keep them in
Source: https://www.investopedia.com/news/largest-cryptocurrency-hacks-so-far-year/
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