The world of digital currencies is thrilling one, where fortunes can be made and lost with a single click. It’s a realm filled with promises of secure transactions and transparent systems, but lurking in the shadows is a relentless adversary: hacking. These cunning culprits have made quite a scene, pulling off daring heists that have sent shockwaves through the cryptocurrency exchanges and platforms, leaving investors trembling at the thought of risking their hard-earned cash.
You see, the blockchain evangelists have long touted their projects as impenetrable fortresses of security. But hold onto your hats, because in 2022, that myth was shattered into a million pieces. It was like a digital Wild West, with back-to-back attacks hitting the scene and showing us that even the mightiest of projects can crumble like a sandcastle at high tide. According to Chainalysis, a whopping $20 billion worth of cryptocurrency was snatched right out from under users’ noses in 2022. In this exploration of the 6 biggest crypto hacks to date, we will uncover the staggering incidents in ascending order based on the amount of funds stolen, revealing the magnitude of these high-profile breaches that have shaken the foundations of the cryptocurrency world.
6. Mt. Gox: $473 Million (May 2014)
Back in 2014, the world witnessed one of the biggest crypto hacks in history as Mt. Gox, a Tokyo-based cryptocurrency exchange, crumbled under the weight of a catastrophic breach. The repercussions were colossal, with a staggering 850,000 Bitcoins, valued at over $473 million at the time, vanishing into thin air. This audacious heist presented a near-existential threat to Bitcoin itself.
The Mt. Gox hack was a meticulously planned operation that spanned several years. Two Russian men, Alexey Bilyuchenko and Aleksandr Verner, stand accused of infiltrating Mt. Gox back in 2011 and gradually syphoning off coins from the exchange. Their nefarious activities went undetected until February 2014 when Mt. Gox finally revealed the extent of the theft and declared bankruptcy.
At its peak, Mt. Gox was responsible for over 70% of global Bitcoin transactions, making it a central hub in the cryptocurrency world. However, this breach shattered the trust and confidence of countless users and had far-reaching consequences for the industry as a whole. The Mt. Gox hack remains a dark chapter in the crypto landscape, serving as a haunting reminder of the urgent need for robust security measures and regulatory oversight to protect against such catastrophic breaches.
5. FTX: $477 Million (November 2022)
It’s impossible not to mention FTX when talking about the biggest crypto hacks of history. In a stunning turn of events, FTX, a prominent cryptocurrency exchange, was struck by an unprecedented hack that reverberated throughout the industry. During the early stages of FTX’s bankruptcy proceedings, an alarming series of unauthorized transactions unfolded, resulting in the brazen theft of an estimated $477 million worth of cryptocurrencies. This shocking breach caught FTX and the entire crypto community off guard, leaving them grappling with the aftermath and raising urgent questions about the vulnerabilities exploited by the perpetrators.
The CEO of FTX, Sam Bankman-Fried, shed some light on the situation during a revealing interview. He pointed to a disturbing possibility, suggesting that the hack could be attributed to either a former employee or someone who had surreptitiously installed malware on an ex-employee’s computer.
4. Coincheck: $534 Million (January 2018)
On January 26, 2018, the crypto world was shaken to its core as the Coincheck hack unfolded. The puts the Coincheck incident number four in the biggest crypto hacks. This brazen attack targeted the Tokyo-based cryptocurrency exchange and resulted in a staggering loss of $534 million worth of NEM coins (XEM). The breach raised concerns about security and exposing vulnerabilities within the exchange’s system.
The exact identities of the hackers behind the Coincheck breach remain shrouded in mystery. These unknown perpetrators managed to infiltrate the exchange’s security measures, exploiting a shortage of employees at the time. Coincheck, in hindsight, admitted to inadequate security measures that paved the way for the successful execution of the hackers’ mission.
3. Binance: $570 Million (October 2022)
The list of the biggest crypto hacks continues with the world’s No. 1 CEX (Centralized Exchange) by volume. Binance On October 7, 2022, the cryptocurrency world was rocked by a significant breach as the Binance hack unfolded. This audacious attack targeted a blockchain operated by Binance, the world’s largest cryptocurrency exchange, which served as a crucial bridge for asset transfers between networks. In a staggering blow, a total of $570 million was stolen, exposing vulnerabilities within the decentralized finance (DeFi) space and raising concerns about the security of cross-chain bridges.
The attack on the Binance Smart Chain network served as a stark reminder of the susceptibility of cross-chain bridges to hacking attempts. While Binance’s CEO, Changpeng Zhao, assured users that no individual funds were lost in the hack, he emphasized the urgent need for the industry to learn from such incidents and strengthen its defenses against future attacks.
2. Poly Network: $610 Million (August 2021)
On August 10, 2021, the crypto world was shaken by a colossal hack known as the Poly Network breach. This audacious attack resulted in the theft of a staggering $610 million from Poly Network, a decentralized finance (DeFi) platform known for enabling seamless token transfers across different blockchains. The hackers exploited a vulnerability in Poly Network’s code, allowing them to transfer the funds directly into their own accounts.
Poly Network’s mission to facilitate peer-to-peer transactions and token swaps across blockchains made it an attractive target for cybercriminals. The breach exposed a critical weakness in the platform’s security infrastructure, emphasizing the ever-present threats faced by the rapidly evolving DeFi sector.
However, what unfolded next was an unexpected twist. In a surprising turn of events, all the stolen assets were returned to Poly Network over the following 15 days. This unprecedented act of returning the funds helped mitigate the impact of the hack and demonstrated the complex dynamics and ethics within the crypto community. Although the stolen funds were returned, we cannot help but include this incident in our list of the biggest crypto hacks.
1. Ronin Network: $615 Million (March 2021)
Now, the honorable mention goes to Ronin Network, which won the first title in the biggest crypto hacks. In March 2021, the Ronin Network, a critical platform supporting the immensely popular mobile game Axie Infinity, fell victim to a devastating hack that reverberated throughout the crypto world. The impact was staggering, with an eye-watering $615 million stolen from the network, making it the largest crypto theft in history. This audacious breach was made possible by compromised private keys, which allowed the perpetrators to exploit vulnerabilities within the system.
The Ronin Network relies on a group of nine validator nodes to authorize transactions on its bridge. To initiate a deposit or withdrawal, the approval of a majority of five nodes is required. However, it appears that these nodes were compromised, enabling the hackers to manipulate transactions and siphon off the substantial sum of funds.
The ramifications of this breach were far-reaching, potentially impacting thousands, if not millions, of individuals who had entrusted their money to the Ronin Network. In response, the company swiftly engaged with law enforcement officials, forensic cryptographers, and its investors to facilitate the recovery or reimbursement of the stolen funds.
Can You Hack a Cryptocurrency?
Now, let’s raise the age-old question: Can you hack a cryptocurrency? Well, it’s a tricky puzzle to unravel. Cryptocurrencies rely on the magic of cryptography, using mind-boggling mathematical algorithms to lock down transactions and fortify the network. Hacking into a cryptocurrency means you’d have to break these complex codes or outsmart the entire system. It’s like trying to solve a Rubik’s Cube with your eyes closed and one hand tied behind your back!
While there have been attempts by hackers to breach cryptocurrencies, they often encounter significant challenges or face legal repercussions. Cryptocurrencies, like any other system, are not impervious to flaws. They have vulnerabilities and weaknesses that can be exploited by hackers or scammers, including the potential for the biggest crypto hacks. For instance, hackers may target users’ wallets, cryptocurrency exchanges, or even exploit flaws in smart contracts. They may also engage in market manipulation or launch attacks on the network infrastructure. However, it is essential to recognize that hacking a cryptocurrency is no easy feat and comes with substantial risks.
How Do You Keep Cryptocurrency Safe from Hackers?
Cryptocurrency, unlike traditional money, operates in a digital realm where hackers lurk. They can target users, exchanges, wallets, and even the blockchain itself. But fret not! There are practical steps you can take to keep your cryptocurrency safe:
First, choose a reputable and secure platform or exchange that prioritizes robust security measures and provides insurance coverage. Next, store your cryptocurrency in a hardware wallet or a cold wallet that remains offline, away from the prying eyes of hackers. Remember to encrypt your wallet and keep your recovery phrase or private keys in a secure location.
Don’t forget to fortify your defenses by using strong passwords and enabling two-factor authentication for your online accounts and devices. Stay cautious and avoid falling for phishing attempts by refraining from clicking on suspicious links or attachments in emails or messages claiming to be from your exchange or wallet provider.
Regularly update your software and antivirus programs, scanning your devices for malware that could compromise your cryptocurrency security. And keep yourself informed about the latest threats and trends in the cryptocurrency space, following the best security practices available.
By implementing these measures, you can mitigate the risk of losing your cryptocurrency to hackers and fully enjoy the benefits of this exciting digital frontier. Stay vigilant and keep your crypto safe from those pesky hackers!
Suggested read: How to invest in cryptocurrency?
The Bottom Line
Cryptocurrencies have robust security measures in place, including cryptography and decentralized structures, making them highly resistant to hacking attempts. Additionally, continuous advancements in security protocols, regular code audits, and collaborative efforts within the crypto community contribute to strengthening the overall security of cryptocurrencies. While it is impossible to claim absolute invulnerability, the ever-evolving nature of cryptocurrencies demands constant vigilance and proactive security measures. Users, exchanges, and developers must remain informed about emerging threats and implement stringent security practices to mitigate risks. To do so, knowing how, when and why the biggest crypto hacks happened can be of huge help.
But the bright side is that in the ever-evolving world of DeFi, where risks and rewards go hand in hand, there are ways to enhance the security of your wallet and stay safe. To bolster your defenses and navigate the DeFi space with confidence, this article “How to Improve Your DeFi Wallet Security,” in which we’ve explained invaluable tips and tricks to safeguard your digital assets like a seasoned pro.
What is the largest crypto theft of all time? Based on the data, so far, the Ronin Network hack with $615 Million is the biggest crypto hack.
Can stolen crypto be recovered? Recovering stolen crypto is difficult due to the decentralized nature of blockchain transactions, making it unlikely unless law enforcement or specialized cybersecurity teams are involved.
Can you hack a cryptocurrency? Cryptocurrencies themselves cannot be hacked due to their decentralized and secure nature. However, the systems and platforms surrounding cryptocurrencies, such as exchanges and wallets, can be vulnerable to hacking attempts.