In recent years, crypto heists have been growing, and even though these heists have been happening for a long time, their increasing frequency is a genuine cause for concern. In the summer of this year, the decentralized finance network – Poly Network – was at the wrong end of a $600 million heist. Not long after this heist, $150 million was stolen by hackers from Bitmart, a crypto exchange.
Out of the 10 biggest crypto heists that have taken place so far, 5 have happened in 2021. Financial tech experts suggest that with greater crypto adoption around the world, such heists will only happen with increasing regularity.
Most crypto heists are initiated by hackers targeting centralized crypto exchanges, which store assets in digital wallets. While these wallets make accessibility easy for users, they also increase vulnerability, allowing savvy hackers to exploit loopholes.
DeFi or decentralized finance services have also been attacked in recent times. The attacks have been successful due to issues with app design and/or coding errors.
However, just because crypto exchanges or networks can be hacked doesn’t mean that users will lose all their money. Different crypto exchanges and platforms levy a variety of resources to thwart hackers’ attempts. Some exchanges also offer security to users in the form of guarantees and pledges. For instance, BitMart covers its users’ stolen assets.
The biggest problem with tracing cryptocurrency hackers is that once the crypto is stolen, it can rarely be traced. Hackers can also disguise their activities by laundering the stolen assets through digital wallets.