Minted

DeFi

Tornado Cash

Crystal

Blockchains are safe, yet they have fallen prey to multiple crypto crimes. The total cost of stolen crypto started rising soon after Bitcoin’s launch and is now estimated at $19B. Crypto heists usually accelerate during bull markets.&nbsp;
Read: <a href="https://www.cryptopolitan.com/defi-protocol-founded-by-sifu-hacked/?_rt=MXwxfHV3dXwxNzE4Mjc1NzE1&amp;_rt_nonce=b8f61643f1" rel="noopener noreferrer nofollow">DeFi protocol founded by ‘Sifu’ hacked for $19.4 million</a>
Crystal Platform’s research shows that the total value of crypto stolen in multiple scams or hacks amounts to $19B. Between 2011 and 2024, the size and value of thefts increased, as did the opportunities to divert coins, tokens, and NFT.&nbsp;
The recent report accounts for 785 incidents, with many smaller heists and personal wallet thefts left unnoticed. Crystal Platform is the most conservative in its estimates regarding crime and loss reports.
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter">
 <div class="wp-block-embed__wrapper">
 <blockquote class="twitter-tweet" data-width="550" data-dnt="true">
 Our latest report shows that over 13 years, nearly $19 billion in crypto was stolen, including $6 billion from security breaches, nearly $5 billion from DeFi hacks &amp; about $8 billion from other frauds. <a href="https://twitter.com/hashtag/blockchainintelligence?src=hash&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow" target="_blank">#blockchainintelligence</a> <a href="https://twitter.com/hashtag/cryptohacks?src=hash&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow" target="_blank">#cryptohacks</a> <a href="https://twitter.com/hashtag/cryptoscams?src=hash&amp;ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow" target="_blank">#cryptoscams</a> <a href="https://t.co/g4zW2SvAzh" rel="noopener noreferrer nofollow" target="_blank">https://t.co/g4zW2SvAzh</a>— Crystal Intelligence (@CrystalPlatform) <a href="https://twitter.com/CrystalPlatform/status/1800898346166497786?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow" target="_blank">June 12, 2024</a>
 </blockquote>
 <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
 </div>
</figure>
Scams and frauds proved the most efficient tools for taking crypto, raking in $8B. Centralized exchange and system hacks accounted for $6B in losses. DeFi, the latest type of hack, accrued $5B in various exploits.&nbsp;
The biggest raw number of attacks happened in 2023 for 286 events. The report has a narrower view of hacks, while the PeckShield count saw more than 600 major events in 2023. Chainalysis has a wider definition of crypto crime, citing more than $24B in exploits just for 2024. Liquidations and trading exploits are also included as malicious usage of crypto technology by some researchers.
There were only 56 attacks in 2024, mostly valuable system hacks. The biggest and most significant hacks usually target BTC and ETH. None have surpassed the Plus Token hack case, which took $2.9B in BTC and ETH.&nbsp;
In the past, hackers could attack projects with significant treasuries. Some heists also involved a human factor, relying on low wallet security. The biggest permanent threat discovered was the Lazarus group of hackers tied to the North Korean regime.&nbsp;
Beyond big hacks, personal scams that target specific wallets are also returning. Malware to extract crypto assets is still deployed, able to target wallets that are logged in and allow transactions.&nbsp;
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter">
 <div class="wp-block-embed__wrapper">
 <blockquote class="twitter-tweet" data-width="550" data-dnt="true">
 1/ Here is an overview of one of the better executed scams I have seen in recent times so I figured I would share with the community as a cautionary tale. A few weeks ago I received a DM from a follower who lost $245K after accidentally downloading malware onto their computer. <a href="https://t.co/gVQEO52XOU" rel="noopener noreferrer nofollow" target="_blank">pic.twitter.com/gVQEO52XOU</a>— ZachXBT (@zachxbt) <a href="https://twitter.com/zachxbt/status/1800906884666528071?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow" target="_blank">June 12, 2024</a>
 </blockquote>
 <script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
 </div>
</figure>
In 2023, an estimated <a href="https://x.com/Lilangelgirllll/status/1798647239734374404" rel="noopener noreferrer nofollow" target="_blank">$3B</a> was lost directly through rug pulls, not counting the notional value wiped out. According to the Hacken report, rug pulls account for 65% of loss events. Those types of attacks coincided with the boom in&nbsp;new token creation.&nbsp;
The most targeted networks in 2023 were Ethereum and Binance Smart Chain. Base, a relatively newer network, saw only six attacks in 2023, with four rug pulls. Scaling blockchains like Polygon, Arbitrum, Optimism and Fantom saw a relatively low number of attacks. While the underlying protocols are sound, the apps they carry can hide risks or perform deliberate rug pulls.&nbsp;
<h2 class="wp-block-heading" id="span-style-font-weight-400-defi-launches-new-wave-of-exploits-span">DeFi launches new wave of exploits</h2>
Decentralized apps, especially ones dealing with trading and value transfers, are becoming the target for crypto theft. DeFi hacks are more elaborate and use a different skillset. Among the top types of thefts, DeFi protocols are threatened by bridge draining and flash loan liquidity pool draining.&nbsp;
Also read: <a href="https://www.cryptopolitan.com/16-mill-exploit-curio-1-bill-cgt-tokens/?_rt=M3wxfGV4cGxvaXR8MTcxODI3NTc3Nw&amp;_rt_nonce=977450c1d5" rel="noopener noreferrer nofollow">$16 Million Exploit Hits Curio Ecosystem: 1 Billion CGT Tokens Minted Illegally</a>
So far, the Ronin bridge hack was the biggest in size, taking away more than $600M. Widely used swapping hubs like BNB Bridge and Wormhole have also suffered exploits. All three did not have an audit of the smart contract. Hackers managed to notice a vulnerability and cause bridge withdrawals. Bridges are still key infrastructure in DeFi, where cross-chain trading and movement of tokens still requires manual approval of transactions.&nbsp;
Even bigger projects are not immune, as in the case of Gala Games. The metaverse and gaming project suffered an exploit of its minting contract, which created unauthorized tokens.&nbsp;
To prevent heists, implementing centralized control over token movements is a viable solution. DeFi projects, stablecoins, and other value hubs often decide to implement this control and the ability to block wallet holders.&nbsp;
For that reason, hackers will often swap funds into Ethereum on its mainnet and mix the haul through Tornado Cash or another mixing service. In that case, the project has no resort to freeze the funds. Most attacks happen against unaudited smart contracts, where the project itself has made an error or inefficiency without noticing.
Cryptopolitan reporting by Hristina Vasileva<gwmw style="display:none;"></gwmw>

The cost of crypto crimes has risen to $19B in the past 13 years

Table of Contents

Cryptopolitan_News

Other articles published on Jun 13, 2024

BRC-20 Tokens, Runes, Ordinals, and Other Bitcoin Ecosystem Innovations Are Poised to Drive Massi...

SEC Chair Gensler reveals when Ethereum ETFs will be approved

Turkish Lira hits record high in crypto market share, surpassing EUR

The Next Big Meme Coin to Boom: Expert Picks of the Best Meme Coins To Buy Now

Polkadot (DOT) Price Prediction: Here’s Why $6.5 Support Could Launch 5X Rally

Why Are BitBot, Dogwifhat Investors Trooping To MoonBag: Can MBAG Reach $1 Pricing in 2024 After ...

Join our free newsletter for daily crypto updates!