Hack Attacks On Crypto Exchanges Are Increasing: Report

The hack attacks on crypto exchanges are now becoming a norm according to a recent report by Chainalysis but this also means that the platforms are now much better prepared which explains why the total value of the stolen funds dropped in 2019 so let’s read more about it in the latest crypto news.

According to the reports, the 2020 crypto crime report shows that 2019 saw 11 hacking attacks on crypto exchanges compared to the 6 ones in 2018 which was a record at that time. However, the hackers doubled their previous records in regard to how many platforms they reached and the amount of stolen funds is three times lower than it was in 2018. The charts show contributions of each hack to the total amounts stolen in a year and there was no major hack comparable to the Mt.Gox in 2014 or Coincheck in 2018. The total amount that was stolen from exchanges dropped to $283 million worth of crypto in 2019 and this figure is only half of the amount of the stolen funds from the Japanese Exchange, Coincheck.

Chainalysis went through all kinds of hacks including those implementing the exploitation of technical vulnerabilities as well as those that only rely on social engineering or other forms of manipulation. Another important thing to know is that the report covered attacks that were related to exchanges only meaning that it ignored payment processors, wallet providers, and investment platforms. The largest crypto hack last year was the one against Coinbene where the Singapore-based exchange lost about $105 million worth of ERC-20 tokens. Binance, Upbit, and BitPoint were next, having lost more than $49 million, $40 million and $32 million worth of crypto.

The hack attacks on crypto exchanges started after cryptocurrencies started gaining attention and becoming popular especially with the enabled anonymous transactions. Chainalysis monitored the movement of the stolen funds and figured out how the cryptocurrencies get liquidated and in most cases, the coins reached other platforms and were then converted to cash. The percentage of illicit services used as a liquidation tool in 2019 dropped to the lowest level in the past few years which suggests that the effects of the increased regulation are real.