- Crypto hacks continue at an alarming rate this year
- The Ethereum Blockchain has suffered the most attacks this year.
- Industry players look to lawmakers to curb crypto hacks.
The first quarter of 2022 has been a roller coaster of both positive and negative events in the crypto market. Compared to Q1s of other years, crypto hacks are at an all-time high this year, with 77 cases reported.
Hackers stole over $1.2 billion of crypto in Q1 2022
Since January, over $1,282,614,945.38 worth of crypto has been lost to criminal actors. Last year, the industry recorded a $9.8 billion loss in crypto hackers. These figures are according to data provided by SlowMist Hacked, which chronicles information about reported crypto breaches.
The Ethereum blockchain ecosystem has been hit the hardest during this period. Protocols in the second-largest blockchain network lost over $635,885,223 million to 18 hack events. The Axie Infinity Ronin network hack, which was discovered this week, was the largest, amounting to around $635 million. Hacks account for almost 99 percent of the total losses in the Ethereum ecosystem and over 50 percent for the entire blockchain industry in Q1 2022.
The Solana network clocked in at second on the leaderboard, with over $388 million lost in four hack events. Wormhole, a cross-bridge between Solana and Ethereum, suffered the biggest loss. The exploit saw hackers make away with around 120,000 Wormhole-wrapped Ether on the Solana blockchain worth around $334 million at the time.
The BNB Smart Chain (BSC) also had its share of events, registering 14 hacks in which around $99.7 million was stolen. Meanwhile, NFT projects had the most events recorded. There was 21 total reported NFT compromise cases recorded by SlowMist, amounting to over $47 million worth of losses.
Commenting on the spate of criminality in the nascent industry, observers have been calling for protocols to adopt best development practices. Similarly, users have also been implored to exercise more caution with their funds.
William S, a cybersecurity researcher and publisher at Atlas VPN, said:
“Blockchain project security should be one of the primary concerns for a person looking to invest in cryptocurrency. Most blockchain-related hack events happen because cybercriminals exploit flaws in the project code.”
Industry experts’ response to rise in crypto hackers
The endemic increase in criminal events has followed crypto and blockchain technology’s growing popularity and adoption. The crypto market has reached a capitalization of $2.27 trillion on the back of a bull rally across the industry.
However, the industry continues to take steps to both prevent hacks and hunt down crypto hackers. Protocols encourage the community to participate in bounty hunts to identify possible flaws in their codebase to earn rewards. This has helped avoid some hacks, especially in the case of OpenSea and, recently, MinSwap, a Cardano-based DEX.
Similarly, the space continues to work with law enforcement and has dedicated crypto security watchdogs like Chainalysis and Messari to these efforts.