With the growth of the crypto industry, crimes such as fake ICOs, Ponzi schemes, and exchange hacks only tend to increase. A recent Chainalysis report revealed that 2019 saw a greater number of exchange hacks than previous years. However, despite a larger number of hacks the value of assets stolen was actually less compared to previous years.
Exchange hacks
Chainalysis report only compared the data regarding exchange attacks while ignoring other similar attacks on wallet providers, payment processors and the like. The report included data of hacks against technical vulnerabilities such as loopholes, deceptive attacks and measured and compared these attacks in value. The report also included data of hacks from private sources as well.
Out of the 11 hacks conducted, the attack on Coinbene was one of the most notorious ones. The attack resulted in a loss of over 100 million dollars from the platform. This was a huge loss considering that the average amount lost per attack was only 26 million dollars. This number is a significant drop from last year’s 146 million dollars average. Moreover, around half of the attacks did not even cause a loss of 10 million dollars.
Chainalysis noted that while the rise in attacks causes concern, the decrease in stolen funds shows that the security of exchanges has improved significantly.
The report traced that most of the stolen funds are transferred to addresses on other exchanges. The report suggests that the funds are then liquidated into fiat currencies such as the US dollar. Although idle tokens can be tracked, third-party mixers or CoinJoin wallets allow users to fog the origin of the stolen funds.
Featured image by pixabay.
