Extent of Losses Due to Hacks and Exploits in 2023
Several reports have emerged towards the end of 2023, shedding light on the losses incurred by crypto platforms and users as a result of hacks and exploits. TRM Labs, a blockchain security analytics firm, reveals in its latest report that the total amount lost reached $1.7 billion by mid-December, with the top ten hacks accounting for 70% of the stolen funds.
Among the reported incidents, “infrastructure attacks” were responsible for almost 60% of the losses. These attacks involve the theft of private keys that grant hackers access to a crypto project’s servers, as well as the use of software to steal funds.
Although $1.7 billion is a significant sum, it is actually less than half of the $4 billion stolen by criminals in the previous year. This decrease can be partially attributed to the $600 million mega hack against the Ronin bridge, associated with Axie Infinity. Notable incidents in 2023, such as those involving Euler Finance, Multichain, and Poloniex, contributed around $100 million each to the total losses.
Recognition of Progress Against Cybercrime
TRM Global Head of Policy and Government Affairs, Ari Redbord, acknowledges the positive strides made in addressing these security issues. He highlights that the global focus on cybercrime has played a role in mitigating some of the malicious activity, which is crucial for the legitimate crypto ecosystem to thrive.
However, De.fi, another Web3 cybersecurity firm, reports an even higher total loss for 2023, reaching $2 billion. They view this figure as a testament to both the ongoing vulnerabilities in the crypto space and the progress made in addressing them, despite a relatively subdued interest in the market during the first half of the year.
Hot Take: Continuing Battle Against Hacks and Exploits in the Crypto Space
Reports on the extent of losses due to hacks and exploits in 2023 highlight the persistent challenges faced by the crypto industry. While efforts have been made to combat cybercrime and enhance security, there is still work to be done. The significant decrease in funds lost compared to the previous year is a positive development, but the total amount is still substantial. It is clear that both infrastructure attacks and software-based thefts remain prevalent in the crypto space. Moving forward, continued efforts to address vulnerabilities and strengthen security measures will be crucial to protect the funds and interests of crypto platforms and users.
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